Is Bud Selig the Smartest Sports Commissioner?
Written by Bob Whalon, Friday November 25 2011
Major League Baseball and its players union agreed to a new Collective Bargaining Agreement (CBA) this week while nobody was paying attention.
This is an amazing feat considering that most of you probably didn't even realize that baseball's labor deal was due to expire in December. While the NFL went right down to the wire in their labor negotiations, losing most of their offseason, and the NBA is on the brink of canceling their entire season, MLB quietly got their deal done.
The five-year labor deal that runs through 2016 ensures the league will have 21 years of uninterrupted labor peace. That's a nice change from the days when MLB had eight work stoppages from 1972-1995, including the 1994-95 strike that wiped out the World Series.
The new CBA is fair to both the league and the union, as both sides made concessions. Unlike the NBA, where the owners will eventually crush the players union and get everything that they want, MLB worked with its players to reach an agreement.
There are some significant changes in this new CBA and unlike other sports; it wasn't all about the money.
The move of the Houston Astros to the American League was already reported when the team was sold last week. That move was made to create equal 15-team leagues with three five-team divisions. The Astros will not move to the AL until the 2013 season because the schedule has already been completed for next season. It is baseball's first realignment since the Milwaukee Brewers moved to the NL after the 1997 season.
The biggest part of this realignment is that with an odd number of teams in each league, there will have to be an inter-league series every day of the MLB season. Love it or hate it, inter-league baseball is not only here to stay, it has expanded.
Another huge part of this deal is that MLB players will be subject to random testing for HGH. The testing will only take place during the offseason and during spring training, but it's better than the NFL, where the players' union is still stalling the league on testing. An initial positive test will result in a 50-game suspension, same as for other performance-enhancing drugs. Baseball's minor leagues already started HGH testing in the minor leagues in 2010.
Other highlights of the deal included: requiring players to play in the All-Star Game unless injured or excused; requiring players arrested for DWI to undergo mandatory evaluation; requiring players to wear improved batting helmets that reduce concussions by 2013; allowing teams to have 26 active players for day-night doubleheaders; and expanding instant replay to include decisions on foul lines and traps.
Of course, the most important aspects of the deal for the owners and players revolved around the finances. As I said before, both sides made concessions to achieve a fair deal.
The minimum salary will increase to $500,000 by the 2014 season and there will be a cost-of-living increase the next two years. There will be a new "competitive balance lottery" that will give small-market and low-revenue teams 12 extra draft picks.
The luxury tax threshold on payrolls will remain at $178 million for the next two seasons. The threshold increases to $189 million for the 2014-16 seasons. Penalties for exceeding the threshold will vary. The tax rate for first-time offenders will decrease to 17.5 percent, but it will increase to 30 percent for second-time offenders, 40 percent for third-time offenders and 50 percent for every time a team exceeds the threshold after that.
There will also be a new market disqualification incentive for clubs to increase revenue that will prevent teams from large markets from receiving revenue-sharing proceeds.
That means that both teams from Los Angeles, New York and Chicago will be ineligible to receive revenue-sharing by 2016 along with Atlanta, Boston, Houston, Oakland, Philadelphia, San Francisco, Texas, Toronto and Washington. The proceeds will be given back to teams paying into the revenue-sharing pool as long as they stay under the luxury tax threshold. There is a provision to allow Oakland to still be eligible if it doesn't get a new ballpark.
Free agent compensation has been completely revamped starting in 2013 under the new CBA. Instead of receiving draft pick compensation based on a complex statistical formula, teams will only be eligible to receive compensatory picks if they offer their own free agent players a 1-year contract equal to the average salary of the 125 highest-paid players from the prior season. This year that figure was $11 million.
A club that signs a free agent must forfeit their first round pick unless it is a top-10 pick. In that case, they would forfeit their second round pick. The change is that the pick doesn't go to the club losing the free agent. Now the compensatory pick will be between the first and second rounds.
While that change favors the players, the owners got what they wanted in changes to draft-pick spending. Under the old plan, the commissioner's office simply recommended the signing bonus for each pick of the June amateur draft. Under the new CBA, teams will be taxed on a sliding scale for every dollar that they spend above their allotted scale.
For international amateur signings, a luxury tax will begin with the July 2012-June 2013 signing season on amounts over $2.9 million. The league is also investigating whether there should be an international draft starting in 2014.
While all of that is great for the league and its players, the one change that matters the most to the fans of baseball is that there will now be two wild card teams, beginning as soon as next season.
Under the new proposal, the top two teams in each league that are not one of the three division winners will meet in a one-game playoff, with the winner facing the No. 1 seed in their league. Unlike in the previous deal, the winner of that wild card playoff game could meet a team from their own division in the Division Series.
Personally I didn't like the idea of two wild card teams at first, but after this past season's playoffs I'm now in favor of the change.
Let's look at the National League as an example, since this new format may have helped my hometown Philadelphia Phillies.
Last year in the NL, the World Series Champion St. Louis Cardinals would have head to play the Atlanta Braves in a one-game playoff before they got to play the Phillies in the NLDS. Although that game would have been played in St. Louis, the Cardinals would have obviously used ace Chris Carpenter against the Braves. That means that Carpenter not only wouldn't have been able to start Game 1 in the NLDS against the Phillies, but he wouldn't have been able to start the deciding Game 5 either. Although Carpenter didn't pitch well in Game 1 of that series, he pitched a complete-game 3-hitter in the series-deciding Game 5.
The Phillies had a MLB-best 102-60 record last season, but their only reward was one extra home game in the 5-game NLDS. That doesn't seem fair. Under this new wild card format, there is more of an advantage given to the division winners. It gives more weight to the 162-game marathon that is the MLB regular season.
So Major League Baseball has achieved labor peace before any of us even realized that their labor agreement was about to expire in three weeks. Baseball is leading the way in labor negotiations, while the other major sports in America flounder. The NFL is still trying to iron out certain details, while the NBA is about to lose an entire season due to the greed of both sides.
I'm certainly not going to tell you that both sides in the MLB labor dispute aren't greedy. What I am going to tell you is that they aren't stupid. Agreeing on a new CBA without any fanfare proves that. Who knew Bud Selig was the smartest of the sports commissioners?
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