New MLB labour deal to scrap all-star game's World Series 'incentive'

A person familiar with the negotiations tells The Associated Press negotiators for baseball players and owners have a verbal agreement on a five-year labour contract.

The luxury tax threshold will steadily rise throughout course of the deal

MLB commissioner Rob Manfred speaks prior to a 2015 World Series game in New York City. (Elsa/Getty Images)

Baseball players and owners reached a tentative agreement on a five-year labor contract Wednesday night, a deal that will extend the sport's industrial peace to 26 years since the ruinous fights in the first two decades of free agency.

After days of near round-the-clock talks, negotiators reached a verbal agreement about 3 ½ hours before the expiration of the current pact. Then they worked to draft a memorandum of understanding, which must be ratified by both sides.

"It's great! Another five years of uninterrupted baseball," Oakland catcher Stephen Vogt said in a text message.

In announcing the agreement, Major League Baseball said it will make specific terms available when drafting is complete.

"Happy it's done, and baseball is back on," Los Angeles Dodgers pitcher Brandon McCarthy said.

One change will be that the league that wins baseball's All-Star Game no longer will get home-field advantage in the World Series, a person familiar with the agreement who spoke on the condition of anonymity told The Associated Press early Thursday.

The innovation was brought in after an all-star game tie in 2002, by a unanimous vote of owners. The advantage will now go to the pennant winner with the better regular-season record.

The American League won 11 of 14 All-Star Games played under the rule, and the AL representative won eight World Series in those years.

As part of the changes for next year, players in the All-Star Game will have the incentive to play for a pool of money.

In addition, players and management agreed the minimum stay on the disabled list will be reduced from 15 days to 10.

The DL change will allow teams to make quicker decisions on whether to bring up a roster replacement rather than wait to see whether the injured player would be ready to return to action in less than two weeks.

As part of the deal, the luxury tax threshold rises from $189 million US to $195 million next year, $197 million in 2018, $206 million in 2019, $209 million in 2020 and $210 million in 2021, the person said. There also will be a new penalty for signing certain free agents that could affect a team's draft order.

Tax rates increase to 20 per cent for first offenders, 30 per cent for second offenders and 50 per cent for third offenders. There also is a new surtax of 12 per cent for teams $20 to $40 million above the threshold, 40 per cent for first offenders more than $40 million above the threshold and 42.5 per cent for second or subsequent offenders more than $40 million above.

Union head Tony Clark, presiding over a negotiation for the first time, said in a statement the deal "will benefit all involved in the game and leaves the game better for those who follow."

A key component is changes to the qualifying offer a club can make to a player who left it to become a free agent, which was $17.2 million this year. If a player turns down the offer and signs elsewhere, his new team forfeits an amateur draft pick, which usually had been in the first round under the old deal.

A player can receive a free-agent qualifying offer only once in his career under the new rules and will have 10 days to consider it instead of seven. A club signing a player who failed to accept a qualifying offer would lose its third-highest amateur draft pick if it is a revenue-sharing receiver, its second- and fifth-highest picks (plus a loss of $1 million in its international draft pool) if it pays luxury tax for the just-ended season, and its second-highest pick (plus $500,000 in the international draft pool) if it is any other team.

A club losing a free agent who declined a qualifying offer would receive an extra selection after the first round of the next draft if the player signed a contract for $50 million or more and after the competitive balance B round if under $50 million. However, if that team pays luxury tax, the extra draft pick would drop to after the fourth round.

Other changes

  • For a team $40 million or more in excess of the luxury tax threshold, its highest selection in the next amateur draft will drop 10 places.
  • While management failed to obtain an international draft of amateurs residing outside the U.S., Puerto Rico and Canada, it did get a hard cap on each team's annual bonus pool for those players starting at $4.75 million for the signing period that starts next July 2.
  • There is no change to limits on active rosters, which remain at 25 for most of the season and 40 from Sept. 1 on.
  • Smokeless tobacco will be banned for all players who currently do not have at least one day of major league service.
  • The regular season will expand from 183 days to 187 starting in 2018, creating four more scheduled off days. There are additional limitations on the start time of night games on getaway days.
  • The minimum salary rises from $507,500 to $535,000 next year, $545,000 in 2018 and $555,000 in 2019, with cost-of-living increases the following two years; the minor league minimum for a player appearing on the 40-man roster for at least the second time goes up from $82,700 to $86,500 next year, $88,000 in 2018 and $89,500 in 2019, followed by cost-of-living raises.
  • The drop-off in slot values in the first round of the amateur draft will be lessened.
  • Oakland's revenue-sharing funds will be cut to 75 per cent next year, 50 per cent in 2018, 25 per cent in 2019 and then phases out.
  • As part of the drug agreement, there will be increased testing, players will not be credited with major league service time during suspensions, and biomarker testing for HGH will begin next year.

Negotiators met through most of Tuesday night in an effort to increase momentum in the negotiations, which began during spring training. This is the third straight time the sides reached a new agreement before expiration, but in 2006 and 2011 the deal was struck weeks in advance.

Talks took place at a hotel outside Dallas where the players' association held its annual executive board meeting. The luxury tax was among the final issues in talks that included topics such as compensation following the loss of free agents and management's desire for an international draft.

Clark, the first former player to serve as executive director of the union, and others were set up in a meeting room within earshot of a children's choir practicing Christmas carols. A man dressed as Santa Claus waited nearby.

While there were no games to be lost at this point, without a deal or an extension of the current collective bargaining agreement, baseball faced the prospect of a hold on transactions and other off-season business only hours after the Mets finalized their $110 million, four-year contract for Yoenis Cespedes and held a news conference with the outfielder in New York on Wednesday.

Baseball had eight work stoppages from 1972-95, the last a 7 ½-month strike in 1994-95 that led to the first cancellation of the World Series in 90 years. In 2002, an agreement was reached just before players were set to strike.


To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversation  Create account

Already have an account?