MLB and MLBPA Agree to New CBA

julio 2016-12-01 16:14:18 UTC #21

The point in this that was "news" to me this morning was the DL change:

The disabled list is no longer 15 days. Long live the 15-day DL. The new agreement reduces the minimum time on the disabled list to 10 days. This makes so much sense; who wouldn't want a chance to see their favorite players for more games during the season? There are some injuries that do not require the full two weeks on the disabled list, but teams had to DL a player because they needed the roster spot.

This implies more frequent use of the DL - and that implies more frequent call-ups of players on optional assignment. This will increase the effective compensation of the players on optional assignments - as 10-day stints with the big club have a major impact on their total pay. So there's a benefit here for the lowest-paid members of the MLBPA.

julio 2016-12-01 16:29:17 UTC #22

Here's Jayson Stark's piece on the new CBA:

julio 2016-12-01 16:42:16 UTC #23

...and here's Stark on compensation for clubs that lose QO free agents:

LoneStarPhan 2016-12-01 17:27:03 UTC #24

If this results in more use of the DL, it also increases days of ML service time overall since the player on the DL still gets his service time plus the called up player gets some days of ML service time. Service time triggers arbitration eligibility and free agency so in the long run, the union has increased player compensation somewhat beyond the increased payroll going directly to the players called up to fill in for DL'd players.

julio 2016-12-01 17:45:15 UTC #25

Right, LSP - somewhat of an increase in overall salary payments by clubs to players.

I saw an article somewhere (not going to find/link it now) that was lamenting the 'modest' increase in the luxury tax thresholds. The article references MLB's overall $9.5 billion revenue, and a luxury tax threshold of "only" $195 million.

So I did some math: $195 million x 30 clubs = $5.85 billion. So if all clubs were at, but not over, the luxury tax threshold, major-league salaries would represent 61.5% of major-league revenue. I don't think that's an unreasonable percentage.

Actual 2016 Opening Day salaries totaled $3.9 billion (just over $130 million/club - data from Cot's Baseball Contracts), or about 41% of revenue. It's hard to argue that the performers in an entertainment industry are overpaid when they're taking home only 41% of total revenue.

phillychuck 2016-12-01 17:48:26 UTC #26

Hi. I'm phillychuck. I liked the rule. Sorry, everybody!

julio 2016-12-01 17:57:37 UTC #28

Yeah, there's always one...

csnyder 2016-12-01 18:19:14 UTC #29

Interesting idea. Is there anything that prevents teams from doing something similar across-the-board to get around the luxury tax? Assuming that consultants (as long as they're contractors) wouldn't count toward the overall payroll...

Austinfan 2016-12-01 18:20:01 UTC #30

I think this is a huge advantage for the Phillies, while a lot of teams focused on the top LA prospects, the Phillies have built up a grass roots scouting organization that has allowed them to find sleepers.

A hard $5M cap means most teams will be signing one or two top guys and scrambling to identify bargains, where the Phillies should have an informational advantage in allocating that $5M since in a sense they've been implicitly playing under these rules.

Austinfan 2016-12-01 18:21:21 UTC #31

It's no different than the games some teams played (who got slapped down?) by paying smaller amounts to top prospects then signing their brother who's a non-prospect. I'm sure the league will be watching for these games and some team will get penalized and lose their allocation or draft picks.

julio 2016-12-01 18:23:06 UTC #32

I don't know the specific answer, Chris...but what's become obvious over the past couple of decades is that clubs with money to burn will find ways to use that money to gain a competitive advantage, whether by just paying penalties, or by finding ways to go around/circumvent rules and restrictions.

Not unique to baseball. Buyers with money who want things find ways to buy those things, whether there are market restrictions or not. That's why black markets exist. So clubs are going to cheat/get around the limits, if they can find ways to do so. Always have; always will.

andyb 2016-12-01 18:58:39 UTC #33

It looks like there are some nuances to the international limit to help lower revenue teams. I think there is an extra million in pool limit for the bottom 15 revenue teams.

No idea how this stops side deals other than MLB policing any expenditures like that.

This is a better system. It really does not help the larger market teams as much as in the past. The luxury cap in general looks a little harder with stricter penalties and some QO/bonus rules that impact teams over the cap line.

All that should help competitive balance a bit, though the huge missed opportunity for the Phillies is that they never abused any of these rules like on international spending when that was permissible. I'd like to think our scouts are generally pretty good, but it is not like we have evidence of them being better than most other clubs. So we revert to a system where all 30 teams are much closer to being equal and where the Phillies could no longer use their revenue as a large market team to add talent. Call it yet another missed opportunity.

Looking ahead to the 2017 draft

julio 2016-12-01 19:02:27 UTC #34

What we have to think about - and what Klentak and his staff have to think about! - is what new opportunities may be opened by the changed rules. I don't know, at this point, but it seems highly likely that there are some new possibilities, "unforeseen" loopholes or benefits available to those who figure them out - in particular, those who figure them out first. Rule changes always seem to come with unintended consequences/impacts.

bigegypt0417 2016-12-01 19:14:53 UTC #35

Passan...
.Int’l bonus $ depends strictly on market size. Teams can trade every $ of their int’l pool. Teams can trade for up to 75% of theirs.

julio 2016-12-01 20:46:44 UTC #36

2 posts were merged into an existing topic: Phillies 2016-2017 offseason Discussion

julio 2016-12-01 19:55:35 UTC #37

But the counter-argument here is that, because they can spend only $5 million or so on international amateurs, it's more important than ever to identify the best opportunities - and one way clubs with more financial resources can out-compete other clubs is by doing a better job scouting in Latin America (e.g., spending more, paying more scouts, etc.). They spend a couple of $ million more on scouting, to improve the return from their $5 million investment in bonuses - as opposed to spending that couple of $ million more on bonuses...possibly for no better overall return than the new way.

julio 2016-12-01 20:41:31 UTC #38

Per Jon Heyman:

English:

When a club signs a Qualifed Free Agent:

If the club is over the luxury tax threshold, they forfeit 2nd and 5th round draft picks, and lose $1 million from international signing pool.
If the club is under the luxury tax threshold, and not receiving revenue sharing, they forfeit 2nd round pick, and lose $500k from international signing pool.
If the club is under the luxury tax threshold, and receiving revenue sharing money, they forfeit a 3rd round pick.

It's not clear to me what happens if a club is over the luxury tax threshold, AND receiving revenue sharing payments - but I'm not sure that ever happens (or could happen), so it may be a moot question.

julio 2016-12-01 20:44:04 UTC #40

And per Rosenthal:

bigegypt0417 2016-12-01 20:47:14 UTC #41

Deleted...

allentown 2016-12-01 21:58:33 UTC #42

The 'new' opportunity seems to be the only old opportunity: over-23 international players.