MLB Has New Collective Bargaining Agreement

Just hours before the old agreement was to expire, MLB announced that it had reached terms on a new Collective Bargaining Agreement (CBA) with the Major League Baseball Players Association.

Months of negotiations had intensified in recent days as the expiration of the old agreement approached at midnight today. Enough progress had been made that notification of a deal was made public.

The next formal step in the process is that a “memorandum of understanding” will be drafted. This document will need to then be ratified by membership on both sides.

While full details of the new CBA will likely not be released to the public for weeks or months, some of the highlights have already leaked out.

LUXURY TAX, FREE AGENT COMPENSATION

Upper thresholds to kick in the Competitive Balance Tax, also known as the “luxury tax”, will rise. Reports are that the new levels will be as follows: $195 million in 2017, $197 in 2018, $206 in 2019, $209 in 2020, and then $210 in the final year of the deal in 2021.

There will be no “international draft”, which the owners were proposing as a cost containment measure. However, information coming from the meetings says that a signing cap of $5-6 million per team will be put in place.

Changes have also reportedly been agreed to in the draft pick compensation process involved with the signing of free agents. In the new system, teams who go over the previously mentioned “luxury tax” will forfeit a 2nd and 5th round draft pick and $1 million of their international draft space when signing qualified free agents.

Should a team under that “luxury tax” limit sign a similar free agent, they would forfeit a 3rd round draft pick only. It has also been reported that players can only receive a qualifying offer once in their career.

Should a team lose a qualifying free agent, reports say that the team losing the player will only receive draft pick compensation if the player’s new contract is for more than $50 million. If a pick is awarded, the placement of that pick will be determined by the losing team’s market size.

This new draft pick compensation system will not apply during the current free agent crop, but will begin next offseason.

FURTHER CBA DETAILS LEAKING OUT

Another issue that was being discussed was expansion of rosters from the current 25 to 26. This will not happen, and the old system will remain in place, allowing expansion of rosters to 40 in September.

Agreements have also apparently been made to change the schedule. Beginning next season there will be 162 regular season games spread over 187 rather than 183 days. This allows for more off days, and scheduling of series abroad.

There are reportedly a number of other issues involved in the new CBA. Changes to revenue sharing, as well as the banning of smokeless tobacco use (grandfathered for current players) are in the new agreement. There will also be a lowering of the minimum stay on the DL from 15 to 10 days.

Another feature of the deal is that the minimum salary will reportedly rise from $507,500 to $535,000 in 2017, $545,000 in 2018, $555,000 in 2019.

ALL-STAR GAME / WORLD SERIES LINK SEVERED

Another interesting item is coming out this morning, with reports that the MLB All-Star Game winner will no longer decide home field advantage in the World Series. Instead, the pennant winner with the best overall record will gain home field advantage.

In the 14 seasons under the previous All-Star format, the pennant winner with the best record did not get home field three times. This includes the most recent World Series. The 94-win Cleveland Indians had home field over the 103-win Chicago Cubs this year.

A number of commentators are going public today regarding “winners” and “losers” between the players and ownership. Let’s be real. Everyone wins with this deal, especially the fans.

This deal keeps labor peace in place in a sport that is rising in popularity over recent years.  There has not been a labor problem in baseball since resolution of the hurtful 1994-95 strikes. America’s Pastime will now enjoy 26 consecutive years without a work stoppage.