Categories: NewsPhillies Beat with Destiny Lugardo

Breaking down MLB’s latest CBA proposals and what’s next

Major League Baseball and the MLB Players Association reportedly met for an hour Thursday via video conference to discuss core economics for the first time since the lockout began in early December.

MLB delivered a proposal that addressed only some of the core disagreements that led to the league’s first work stoppage since 1994. The union rejected the proposal, but they will reportedly respond with a proposal of their own.

CBA negotiations restarted on Thursday. (Photo by Rich Graessle/Icon Sportswire)

According to multiple reports, the league’s proposal addressed service-time manipulation, “Super Two” arbitration eligibility, the draft lottery and the designated hitter. Other subjects, such as free agency, revenue sharing, expanded postseason and the luxury tax either went unaddressed entirely or the league reiterated its previous stance from the last round of collective bargaining.

Here’s a rundown on what happened Thursday.

MLB’s New Proposals

Service-Time Manipulation: In an attempt to incentivize teams to call up MLB ready top prospects as soon as possible, the league proposed that teams be awarded a draft pick if a Top 100 prospect is called up to the MLB roster on Opening Day and either wins the Rookie of the Year Award or finishes in the Top 3 in MVP or Cy Young voting. Teams would only be eligible to receive one compensatory pick per player. To use a hypothetical example, if Bryson Stott were to make the Phillies roster on Opening Day in 2022, win the Rookie of the Year Award and finish in the top three in MVP voting the following year, the Phillies would only be eligible to receive one pick. In the previous collective bargaining agreement, teams were able to obtain an extra year of control over a player if they kept him in the minor leagues for approximately two weeks to ensure he doesn’t reach the 172-day threshold that constitutes one year of service. Former Phillie Maikel Franco filed a grievance against the Phillies in December 2015 after the team kept him in Triple A until the middle of May that season.
“Super-Two” Arbitration Eligibility: MLB reportedly proposed to gradually phase out the “Super Two” class, which is a subset of MLB players who become arbitration eligible by virtue of being in the top 22% of service time accumulated among all players between two and three years of service time. Instead, the league wants all players who are between two and three years of service to be paid using a performance-based formula. Players between three and six years of service time would still be eligible for salary arbitration. The union wants to extend arbitration eligibility to all players with at least two years of service time. Ranger Suárez and Sam Coonrod are the only current Phillies who are between two and three years of service time.
Draft Lottery: MLB is sticking with its three-team draft it previously proposed, but added that a team would be disqualified from the lottery after being in it for three consecutive seasons. The union previously proposed an eight-team lottery.
Designated Hitter: MLB proposed to add the designated hitter to the National League.

Previous MLB Proposals That Are Still On The Table

Expanded Playoffs: MLB is reportedly still hoping to expand the postseason to seven teams in each league. The top team in each league would receive a bye into the divisional round. The other two division winners would get to pick their opponents in a best-of-three wild card series among the bottom three wild card teams. The higher-seeded team would host all three games and the winners would advance to the division series with the playoffs continuing as they normally would. The union previously proposed an expanded postseason field with six teams in each league on the condition that other proposals from the players side are accepted.
Collective Bargaining Tax: MLB is still proposing a $214 million luxury tax threshold for next season, which would rise to $220 million by the end of the collective bargaining agreement. The two sides are far apart on this issue as the union previously proposed a $245 million threshold with the elimination of progressive penalties for offenders. This issue has implications for the Phillies, who have preferred in the past to spend up to the threshold. Last season, the Phillies finished less than one million dollars under the $210 million threshold.
Minimum Salary: Both sides previously agreed to raise the minimum salary. MLB wants to introduce a tiered system based on service time that would pay players anywhere between $600,000 to $700,000. The union proposed a $775,000 minimum salary in 2022 that would rise to $875,000 by the end of the deal plus a bonus pool of money from the league’s central revenues to be awarded to pre-arbitration eligible players based on performance incentives. The minimum salary in 2021 was $570,500.
Free Agent Draft Pick Compensation: MLB previously offered to eliminate draft penalties for teams who sign a qualified free agent. In the previous agreement, teams forfeited at least one draft pick and lost international bonus pool money if they signed a free agent with a qualifying offer attached. The Phillies surrendered their second-round pick and $500,000 in international bonus pool money in 2019 and 2020 after signing both Bryce Harper and Zack Wheeler.

Embed from Getty Images

What Did The Two Sides Agree On?

According to USA Today, the league came to an agreement with the union on benefits and pensions.
That’s about it.

MLB Won’t Address…

Revenue Sharing: The union wants to eliminate $100 million from the local revenue sharing pool. MLB insists that it won’t touch the current system, which subjects 48% of local revenue for all 30 teams to revenue sharing.
Free Agency: The union is seeking a change in the free agent system. According to the Associated Press, the players proposed before the lockout to keep the current system for both this offseason and next offseason. Starting in the 2023-24 offseason, the union wants free agency for all players after either five years of service and age 30.5 or six years of service. For the 2025-26 offseason, players would be eligible for free agency with six years of service or five years of service and age 29.5. MLB, who prefers to keep the current system of six years to free agency, did not address this proposal from the players.

What Did The Union Think Of MLB’s Proposals?

The players were reportedly underwhelmed with the league’s proposals to say the least. MLB’s “Super Two” proposal in particular was a head scratcher for the union. The value of an extra year of team control of an impactful young player making the minimum salary far outweighs the benefit of a team possibly netting a draft pick if the player is in the mix for an award.

What’s Next?

The union will counter with a proposal of their own. It’s unclear when exactly that proposal is coming. ESPN suggests that it could come near the end of January.
The timing of the next proposal could determine whether spring training begins on time or not. The two sides would have to reach a deal in the first week of February to ensure that pitchers and catchers can report to camps two weeks later.

Will The Regular Season Start On Time?

This is just my opinion, but it’s too early to start panicking about missing regular season games. The two sides would have to reach a deal on a new collective bargaining agreement by the beginning of March for the season to start on time.