MLB gives first proposal re New Payroll Rules

[chpettit19]

The Athletic is reporting MLB gave their first proposal to the MLBPA on team spending rules. Dropping luxury tax threshold to $180M and implementing a $100M payroll floor. Obviously very early on and nothing at all is even close to set, but if this is the starting point, and something being discussed, I have hope that this new CBA will address some real competitive balance issues in the league.

[beckmt]

This sounds like a great idea, assuming both the cap and floor are hard.  But doubt they will be.  Competitive balance at this time is a joke, if you see the records after the trade deadline.

[Dman]

16 minutes ago, chpettit19 said:

The Athletic is reporting MLB gave their first proposal to the MLBPA on team spending rules. Dropping luxury tax threshold to $180M and implementing a $100M payroll floor. Obviously very early on and nothing at all is even close to set, but if this is the starting point, and something being discussed, I have hope that this new CBA will address some real competitive balance issues in the league.

Yeah I think that floor is going to be important to getting it done. Players association is going to want more competition for players and more places they can go helps with that.  If a team can't manage the 100M floor then they probably need to be moved to a place where that would be more viable.

Trying to keep teams at 180M will require all teams to build with prospects and not get to rely on always signing the best players to cover for those deficiencies.  

Still a ways to go yet though as they have to work out team control for the young players.  Almost 7 years is too long and I would argue 6 years is probably too long to have control unless those arb salaries can be lifted up somehow.  Getting an extra year for holding a player back a few months needs to go as well.  It just isn't a good look for the sport.  Hopefully they can get this done and avoid a work stoppage or it might hurt both sides.

[Mike Sixel]

I can't see the MLBPA agreeing to salaries dropping for the top players. No way.

[Cap'n Piranha]

1 minute ago, beckmt said:

This sounds like a great idea, assuming both the cap and floor are hard.  But doubt they will be.  Competitive balance at this time is a joke, if you see the records after the trade deadline.

Sounds like there will not be a hard cap, just a luxury tax.  Dropping it still will help.  Currently, the threshold is set at $210M, and penalties are 20% for year 1, 30% for year 2, and 50% for year 3 (so long as those years are consecutive).  That means this tax would be an extra $6M to $15M for a team at the $210M number or higher.

One thing this will do, that will be fascinating to watch, is mitigate the risk of bad contracts.  Imagine you're a team with a $105M payroll, and you're losing, so you want to trade your expiring contracts for prospects.  You'll need to simultaneously acquire a different expiring contract in order to stay over the floor.

[Cap'n Piranha]

4 minutes ago, Mike Sixel said:

I can't see the MLBPA agreeing to salaries dropping for the top players. No way.

I could.  The list of MLBPA members making $2m or less is much larger than the list making $20M or more.  If the owners were truly smart, they would put forth a proposal that would set minimum salary at $2M, but cap the max salary at $20M-$25M.  You think Ober, Jax, Arraez, Kiriloff, Larnach, Gordon, Astudillo, Garcia, Gant, Garza, Jeffers, etc. are all going to vote against a tripling in their pay, just so 30-40 players can make 30 to 35 times what they do, instead of 10 times?

[beckmt]

5 minutes ago, Cap'n Piranha said:

I could.  The list of MLBPA members making $2m or less is much larger than the list making $20M or more.  If the owners were truly smart, they would put forth a proposal that would set minimum salary at $2M, but cap the max salary at $20M-$25M.  You think Ober, Jax, Arraez, Kiriloff, Larnach, Gordon, Astudillo, Garcia, Gant, Garza, Jeffers, etc. are all going to vote against a tripling in their pay, just so 30-40 players can make 30 to 35 times what they do, instead of 10 times?

But it will mainly limit the middle class of players to not making as much.  Sorry the top dogs will still get paid, or clubs without a higher penalty will just ignore the first part of the cap.

[Mike Sixel]

4 minutes ago, beckmt said:

But it will mainly limit the middle class of players to not making as much.  Sorry the top dogs will still get paid, or clubs without a higher penalty will just ignore the first part of the cap.

Correct. Just like the NFL. A few really rich players, a handful of middle class, and a huge majority making the minimum. 

 

[Vanimal46]

Seems like a half assed measure to prevent tanking, and simultaneously cut costs for the large market teams. Why don’t they make a hard salary cap and floor instead of taxing if they go over? 

[TheLeviathan]

Baseball desperately, desperately needs a salary cap and floor.  I can't type the word "desperately" enough for this situation.

[chpettit19]

4 minutes ago, Vanimal46 said:

Seems like a half assed measure to prevent tanking, and simultaneously cut costs for the large market teams. Why don’t they make a hard salary cap and floor instead of taxing if they go over? 

My understanding of most floor/cap situations in sports is that it's based on league revenue. MLB owners are really, really, really, really, really, really, really, really, really, really, really, really, really against opening their books and showing what they're actually making.

This current proposal has no shot of getting MLBPA approval. Anything that lowers the tax threshold is not getting accepted. The MLBPA wants nothing to do with a cap and are already mad about teams using the current system as a cap. They want a floor with no ceiling. Neither MLB nor the MLBPA care about the game or fans. Their negotiations are strictly financial and both sides are looking for ways to get the biggest piece of the pie they can. I think it gets ugly, but the fact that they're throwing around these kinds of ideas at least provides a pinhole of light in the great darkness that has been this season as a Twins fan.

[prouster]

On its face the proposal seems like a good starting point. I agree that the players’ union will almost certainly not agree to lowering the tax threshold. As someone who is habitually skeptical of MLB owners, I also wonder if this could be some kind of end around that winds up giving players less of the overall pie once the numbers shake out. We’ll see what happens!

[Cap'n Piranha]

1 hour ago, beckmt said:

But it will mainly limit the middle class of players to not making as much.  Sorry the top dogs will still get paid, or clubs without a higher penalty will just ignore the first part of the cap.

That's why there would be a cap on individual player contracts.  Imagine how much more fun free agency will be when every team can compete on exact level footing (at least with an individual player).  If the Rays payroll is projected to be $90M, they may very well offer Gerrit Cole $25M per.  Maybe he doesn't take it--but maybe he thinks the Rays are a really well-run org, and he'd like to be there, and there's no financial disincentive to that now.

[Cap'n Piranha]

1 hour ago, Mike Sixel said:

Correct. Just like the NFL. A few really rich players, a handful of middle class, and a huge majority making the minimum. 

 

Who cares if a huge majority make the minimum if it's 40x what the average American family makes in a year.  Combine that with a revamped system that sets free agency at years since drafting/signing or age, and what you'll end up with is a system that spits out Jake Caves in order to get Austin Martins to the majors sooner.  Is that really such a bad thing?

[Cap'n Piranha]

1 hour ago, Vanimal46 said:

Seems like a half assed measure to prevent tanking, and simultaneously cut costs for the large market teams. Why don’t they make a hard salary cap and floor instead of taxing if they go over? 

Not if those large market teams want to keep winning at the rate they're accustomed to.  The Rays are outperforming the Yankees despite spending only $70M; what will they do if forced to spend $30M more?  You think the Yankees are going to just spend less, and let the current performance gap get even wider?  The Dodgers, Yankees, Mets and Red Sox will all keep spending, luxury tax be darned, but it will create more revenue to go to the lower tier teams.  I'm not sure how else you stop tanking, other than forcing teams to employ a collection of players generally considered to be worth approximately $100M, at minimum, every year.

[Mark G]

1 hour ago, Dman said:

Yeah I think that floor is going to be important to getting it done. Players association is going to want more competition for players and more places they can go helps with that.  If a team can't manage the 100M floor then they probably need to be moved to a place where that would be more viable.

Trying to keep teams at 180M will require all teams to build with prospects and not get to rely on always signing the best players to cover for those deficiencies.  

Still a ways to go yet though as they have to work out team control for the young players.  Almost 7 years is too long and I would argue 6 years is probably too long to have control unless those arb salaries can be lifted up somehow.  Getting an extra year for holding a player back a few months needs to go as well.  It just isn't a good look for the sport.  Hopefully they can get this done and avoid a work stoppage or it might hurt both sides.

You had me

 

1 hour ago, Dman said:

Yeah I think that floor is going to be important to getting it done. Players association is going to want more competition for players and more places they can go helps with that.  If a team can't manage the 100M floor then they probably need to be moved to a place where that would be more viable.

Trying to keep teams at 180M will require all teams to build with prospects and not get to rely on always signing the best players to cover for those deficiencies.  

Still a ways to go yet though as they have to work out team control for the young players.  Almost 7 years is too long and I would argue 6 years is probably too long to have control unless those arb salaries can be lifted up somehow.  Getting an extra year for holding a player back a few months needs to go as well.  It just isn't a good look for the sport.  Hopefully they can get this done and avoid a work stoppage or it might hurt both sides.

You had me until the team control idea.  I know I am in a minority of one here, as I usually am, but the team that drafts a player, pays the signing bonus, grooms him along in the minors for years, and turns this raw talent into a major league player, deserves to reap the rewards for a lot longer than they do.  I would propose binding arbitration throughout MLB from a players 2nd season on, but give the team more years, not less, of control over their investment; because, at the end of the day, the organization invests in the players, the players do not invest in the organization.  They receive payment from the word go, little as it may seem at first, and it increases each year they prove their worth.  And the fans deserve a team they can get to know and feel a part of, not hired guns going from town to town for the highest offer.  The players will get their worth through arbitration and the fans will get a team they feel they know.  In my extremely humble opinion, that would be the best move for the game, not moving them around even sooner. 

[wsnydes]

While I don't see this being agreed upon, it, or something like it, could at least be a gateway to a hard salary cap and floor.  There's no chance they go from the current system to a hard cap and floor like other leagues have.  There's going to be some middle ground and a gradual transition to one, if it's ever going to happen.

I'm not holding my breath, though.

[Mike Sixel]

17 minutes ago, Cap'n Piranha said:

Who cares if a huge majority make the minimum if it's 40x what the average American family makes in a year.  Combine that with a revamped system that sets free agency at years since drafting/signing or age, and what you'll end up with is a system that spits out Jake Caves in order to get Austin Martins to the majors sooner.  Is that really such a bad thing?

So it should go to the owners? I don't get your argument. How much they make compared to us is irrelevant. 100 percent irrelevant.

[Mike Sixel]

9 minutes ago, Mark G said:

You had me

 

You had me until the team control idea.  I know I am in a minority of one here, as I usually am, but the team that drafts a player, pays the signing bonus, grooms him along in the minors for years, and turns this raw talent into a major league player, deserves to reap the rewards for a lot longer than they do.  I would propose binding arbitration throughout MLB from a players 2nd season on, but give the team more years, not less, of control over their investment; because, at the end of the day, the organization invests in the players, the players do not invest in the organization.  They receive payment from the word go, little as it may seem at first, and it increases each year they prove their worth.  And the fans deserve a team they can get to know and feel a part of, not hired guns going from town to town for the highest offer.  The players will get their worth through arbitration and the fans will get a team they feel they know.  In my extremely humble opinion, that would be the best move for the game, not moving them around even sooner. 

So. No freedom for players? Unreal. That will completely suppress salaries. 

[Mike Sixel]

13 minutes ago, Cap'n Piranha said:

Not if those large market teams want to keep winning at the rate they're accustomed to.  The Rays are outperforming the Yankees despite spending only $70M; what will they do if forced to spend $30M more?  You think the Yankees are going to just spend less, and let the current performance gap get even wider?  The Dodgers, Yankees, Mets and Red Sox will all keep spending, luxury tax be darned, but it will create more revenue to go to the lower tier teams.  I'm not sure how else you stop tanking, other than forcing teams to employ a collection of players generally considered to be worth approximately $100M, at minimum, every year.

So.... At the trade deadline.... How does a team trade Cruz type of they are close to the floor? Or, just don't, and decrease competitiveness long term?

[Mark G]

6 minutes ago, Mike Sixel said:

So. No freedom for players? Unreal. That will completely suppress salaries. 

The freedom is in the choice of the profession.  No one has ever been forced to go onto a baseball diamond since its invention; every player drafted knows the drill and 99% can't wait to turn pro.  And, no, it will not suppress salaries, as binding arbitration would be installed from the beginning and run just as it is today.  If anything, you won't find players making the minimum or just above 3 or 4 years into their career because of arbitration.  It would end, however, the 9 figure contracts, I suppose if that is what you are referring to as suppression.

In your profession, whatever it is, do you have the choice to move from plant to plant, store to store, office to office, (you get the point) regardless of where your employer wants to position you?   I don't, never have, and have never known anyone who has.  At the end of the day, the players are employed by MLB, and are assigned a starting point, just like every employee I have ever known.  The freedom players have is the same freedom you and I have; we can change employers.  In this case, they would have to go somewhere other than MLB, which is not something the players want to do for the most part.  As long as I work for the organization I work for now, I accept their assignment or I find another employer.  Not sure why that is such a hard concept.  The question I would ask in return is:  why is professional sports any different than every other profession?  Unless you want to turn players into independent contractors, which would mean they are like any other such folks; no benefits and a fee for service type of income.  Not practical, so they stay employees.  Of MLB.  And so the debate goes on.  Hope you take it for what it's worth.

[Mike Sixel]

5 minutes ago, Mark G said:

The freedom is in the choice of the profession.  No one has ever been forced to go onto a baseball diamond since its invention; every player drafted knows the drill and 99% can't wait to turn pro.  And, no, it will not suppress salaries, as binding arbitration would be installed from the beginning and run just as it is today.  If anything, you won't find players making the minimum or just above 3 or 4 years into their career because of arbitration.  It would end, however, the 9 figure contracts, I suppose if that is what you are referring to as suppression.

In your profession, whatever it is, do you have the choice to move from plant to plant, store to store, office to office, (you get the point) regardless of where your employer wants to position you?   I don't, never have, and have never known anyone who has.  At the end of the day, the players are employed by MLB, and are assigned a starting point, just like every employee I have ever known.  The freedom players have is the same freedom you and I have; we can change employers.  In this case, they would have to go somewhere other than MLB, which is not something the players want to do for the most part.  As long as I work for the organization I work for now, I accept their assignment or I find another employer.  Not sure why that is such a hard concept.  The question I would ask in return is:  why is professional sports any different than every other profession?  Unless you want to turn players into independent contractors, which would mean they are like any other such folks; no benefits and a fee for service type of income.  Not practical, so they stay employees.  Of MLB.  And so the debate goes on.  Hope you take it for what it's worth.

You can move to other employers in the same industry, yes . It constantly amazes me people want humans treated as assets, not people. 

[prouster]

49 minutes ago, Mark G said:

You had me

 

You had me until the team control idea.  I know I am in a minority of one here, as I usually am, but the team that drafts a player, pays the signing bonus, grooms him along in the minors for years, and turns this raw talent into a major league player, deserves to reap the rewards for a lot longer than they do.  I would propose binding arbitration throughout MLB from a players 2nd season on, but give the team more years, not less, of control over their investment; because, at the end of the day, the organization invests in the players, the players do not invest in the organization.  They receive payment from the word go, little as it may seem at first, and it increases each year they prove their worth.  And the fans deserve a team they can get to know and feel a part of, not hired guns going from town to town for the highest offer.  The players will get their worth through arbitration and the fans will get a team they feel they know.  In my extremely humble opinion, that would be the best move for the game, not moving them around even sooner. 

Your suggestion is to severely limit and, for many players, outright eliminate free agency—the single biggest victory in the history of the MLBPA? I don’t think that’s going to happen. I also think it would be absolutely devastating for the game itself. 

[Mike Sixel]

11 minutes ago, Mike Sixel said:

You can move to other employers in the same industry, yes . It constantly amazes me people want humans treated as assets, not people. 

I mean, can a computer programmer switch companies? A teacher districts? A bartender? Anyone without a contract, and stay in their profession:? Yes. I agree, MLB should be MORE like that. 

[Mark G]

4 minutes ago, Mike Sixel said:

You can move to other employers in the same industry, yes . It constantly amazes me people want humans treated as assets, not people. 

I would submit it does not have to be in the same industry.  I, for one, have changed industries half a dozen times in my working life.  When players are done with their playing careers, how many stay in baseball as a profession, and how many move on to another type of life?  If they genuinely can't take playing for a particular organization, they have the freedom to move any time their contract expires.  Just as you and I.  And, yes, as much as I hate the concept as well, to a business/corporation we are assets, albeit  human ones.  And all companies look at the investment they make in hiring, training, re-training, and so on as just that - an investment in us.  And with very few exceptions, we don't buy our jobs; we are paid from the first minute we start a job,  which is why it is an investment.  So it is with baseball players, as I described.  I am simply pointing out they are employees the same as you and I and an employer has a right to get a return on their investment.  Never meant to offend.

[Mark G]

4 minutes ago, prouster said:

Your suggestion is to severely limit and, for many players, outright eliminate free agency—the single biggest victory in the history of the MLBPA? I don’t think that’s going to happen. I also think it would be absolutely devastating for the game itself. 

I agree completely it isn't going to happen.  But I am old enough to have seen before and after free agency for long enough periods to be able to make a personal comparison, and I would submit that if we were only talking about what is good for the game, not the players OR the owners, it would be the former, not the latter.  And that is solely based on what is good for the fans, without whom there is no professional ball, only sandlot.   Some teams buying hired guns and the others hoping that "prospects" will pan out.......what a discrepancy in competitiveness.  How that is good for the game/fans, I am not intelligent enough to understand, I guess, so that is why I am a minority of one. 

[Mark G]

9 minutes ago, Mike Sixel said:

I mean, can a computer programmer switch companies? A teacher districts? A bartender? Anyone without a contract, and stay in their profession:? Yes. I agree, MLB should be MORE like that. 

Not sure what you mean by more like that.  Do any of those professions have an anti trust exemption?  I would submit no, which is why there are so many choices within the profession.  MLB is in a completely different category in that sense.  Other employers in the same field would be other leagues than MLB, and that has always been and always will be an option for baseball players.  But as long as they are employed by MLB.........well, I have said enough; I am already in doghouse here.   

[bean5302]

This is an offer which gives the MLBPA something it really wants. Dramatically increased competition for its players. While I think the $100MM is a bit too high, I think it's also intentional. MLB wants to force the hands of taxpayers in Oakland and Tampa to build new stadiums. The $100MM threshhold will give both of those teams a compelling argument for why they have to leave if they don't get a new stadium. I still think it's a fantastic idea and close to what I proposed in a different thread. Tanking must be stopped. Rebuilds should not result in teams which are totally and completely uncompetitive for 4 or 5 years. 

Dropping the competitive balance threshhold to $180MM feels a bit like trying to find a way to reduce top player salaries as mentioned, but it would also prevent teams abusing the crap out of the system like the Dodgers from completely blowing past the tax threshold in an attempt to block other divisional teams from competing.

I don't see the argument being valid in regard to limiting mid-value players. I think it is far more likely to limit the top value players from getting potentially team killing albatross contracts of 10-14 years and $350MM+. Having a couple super elite players on your team is not going to get you to the playoffs, let alone allow you to win playoff games. Those elite players are worth a lot, but you need a solid foundation.

I feel like this offer is genuine and will probably be viewed as fairly refreshing and in good faith for addressing a major issue the MLBPA wants addressed. Team control is obviously the other major factor.

[beckmt]

I could this base of working, if the overage tax started at 50 went to 75 and then to 100% of the overage in the third tier, doubles in each subsequent year to 100,150,200 and stays there until reset.  That would help all owners and players.

[Nashvilletwin]

6 hours ago, Mike Sixel said:

I can't see the MLBPA agreeing to salaries dropping for the top players. No way.

Agree 100%. The big stars call the shots - they won’t give up any $ so the little guys on a whole make more.