With Major League Baseball’s collective bargaining agreement with the MLB Players’ Association expiring at midnight Wednesday evening, the league’s 30 owners voted to lock out players beginning Thursday, creating the first work stoppage since 1994-95.
MLB officials met multiple times this week with their union counterparts along with players on the MLBPA’s executive council, but as highly expected, there was not nearly enough runway for the sides to hammer out an agreement during what’s expected to be the most contentious CBA negotiations since 2002.
Instead, Rob Manfred (commissioner) will, at owners’ request, freeze all league business until an arrangement is reached. This means that there will be no player access to club facilities, and no signings of free agents or trades.
The CBA’s impending expiration kick-started a free agent frenzy in the days and hours preceding it, as six players agreed to nine-figure contracts and teams doled out more than $1.7 billion in contracts in November.
Such lucre would indicate an industry in good health, and nobody’s losing money in the big leagues, from owners to executives to players. The CBA dispute has been going on for five years. Many owners had a monopoly over their teams and devalued the veteran players.
Players, then, are seeking radical changes to compensation to counter the industry’s enhanced valuation of younger talent. For free agency, six years service is required by MLBPA. Five years is necessary if the player is older than 29 1/2 years. The MLBPA also wants to find other ways to pay young productive players sooner, using performance and award benchmarks. Teams can decide unilaterally what the salary of players who have zero to three years service, regardless of their value.
In a letter to fans released on the league’s website that was scrubbed of any mention of current players on its home page, Manfred moved quickly to assign blame to players in bemoaning the league’s inability “to extend our 26 year-long history of labor peace and come to an agreement with the MLBPA before the current CBA expired.”
“This defensive lockout was necessary because the Players Association’s vision for Major League Baseball would threaten the ability of most teams to be competitive,” says Manfred, who helms a league that’s seen 21 of 30 franchises reach the World Series since 2001. “It’s simply not a viable option. MLBPA has refused to change their position or compromise.
“… Unfortunately, the Players Association arrived at the bargaining table with an approach of confrontation instead of compromise. Collectively, they never wavered, even though the proposals were the harshest in their history. These included significant reductions to revenue sharing, weakening competitive balance taxes, and reducing the time players can play for their team. These changes will make the game more competitive and less fun.
Players hope to convince franchises not to use the luxury tax as an actual salary cap. They want the tax ceiling to be set at a higher level. The 2021 season’s luxury tax was $210million, including salaries and benefits for all 40 players. It hasn’t risen at an appropriate rate compared to the industry’s nearly $11billion in revenues.
The final proposals were exchanged Wednesday by the players who requested a $245m luxury tax threshold with no progressive penalty for offenders. Instead, owners offer a $214m threshold which will rise to $220m in year five.
This is an enormous, but easily navigable, gulf that suggests the owners’ desires to change their behavior or, at minimum, loosen spending controls.
Max Scherzer (three-time Cy Young Award Winner) is a member the MLBPA executive council and has been to multiple negotiating sessions. He says that his $130 million, three-year deal with New York Mets shows Steve Cohen’s disdain for luxury taxes.
“That’s a specific thing we’re negotiating on right now – how teams view that as a cap and won’t spend too much over that despite the penalties being pretty negligible,” Scherzer said from Irving, Texas, in a video news conference introducing him as a Met. “Steve showed he’s willing to do whatever it takes to win. That’s music to my ears.”
The players’ desired alterations to copmensation are relatively aggressive and and that’s before any on-field issues – expanded playoffs, a pitch clock, the designated hitter – are broached. It’s compounded by the fact players have little to offer owners in return, save for some form of playoff expansion that would generate significant revenues.
MLBPA rebuffed MLB’s offer for a playoff field of 14 teams. They instead proposed a 12-team option. This would increase TV revenue, but also, according to their view, preserve the integrity and drive franchises to compete more fiercely to be in the postseason.
While both sides hoped the looming specter of a deadline would force them closer to an agreement, it’s unsurprising that such complex and potentially disruptive topics were not agreed upon by the stroke of midnight Wednesday.
One more round of signings and trades occurred in the hours leading up to the lockout. The Chicago Cubs agreed to a $31 million, three-year deal with Marcus Stroman, right-hander. Infielder-outfielder Chris Taylor was signed to the Los Angeles Dodgers for a $41 million, four-year contract.
Red Sox and Brewers traded outfielders. Hunter Renfroe headed to Milwaukee while Jackie Bradley Jr. returned to Boston. Reds announce signing five minor-league, free agents. This is a move that was made by a group who wants to be a part of a definitive spring destination.
While this technically is a work stoppage, the timing of the CBA’s expiration offers both parties a chance to reach agreement before any games – exhibition or regular season – are lost. But that window isn’t necessarily unlimited. Catchers and pitchers are expected to report to spring camp beginning February 15. Exhibition games will begin 11 days later.
Opening Day is scheduled for March 31.
It also marks the start of the player’s first salary period. MLBPA is withholding some licensing money in order to create a salary pool for player’s, Scherzer indicated that they would be ready for any long term if the strike continues.
Scherzer states that “we have a fairly good war bank behind us, money we are able to allocate to players in situations like these.” “Knowing, for the past five years, we’ve been thinking we’ll need as big a war chest as possible coming into this.
The best scenario is to never tap it. Of course, we do hope to get a deal in the future.
Indeed, the principals involved are all old enough to remember the dark days of 1994-95, when a players’ strike wiped out the ’94 World Series and owners attempted to deploy replacement players to start the next season. The previous CBA only allowed players to be reinstated on the field after they were temporarily injuncted.
The 2022 season is in jeopardy if this round becomes so bloody. But not since September 2002 negotiations – when the cloud of ’94 loomed far more significantly – have the sides weighed such meaty issues. The issues were revenue sharing and drug testing. An agreement was made just hours before the games became a disaster.
Potentially, there is an entire winter in discord, which threatens the spring rituals.