Mlb Player Contracts
What are the rules around MLB teams and their players (i.e. contracts, waivers, free agents, etc…)?
I like baseball, but have never really understood the rules around how different MLB clubs trade, acquire or get rid of players? You hear stuff about arbitration, options, etc… but it’s not clear how this all works. Does anyone have a summary or know of a place where I can learn how this whole process works?
generally speaking, a team owns the rights to a player for their first 6 years in the majors. for the first 3 years, the team can pay him whatever they want (usually close to the minimum). the next 3 years, the player is arbitration-eligible. that means if the player and the team can’t agree on a contract, they go to an arbitrator who will decide the amount of a *one-year* contract for the player. basically the arbitrator will base this amount on arguments from both sides and salaries for comparable players. alternatively, the team can “non-tender” the player, essentially making them a free agent. after that 6-year period, the player can go into free agency (assuming the player and team didn’t agree on a long-term deal that locked him up beyond that period). this is why it is so important for teams without a ton of cash to draft well … they have their young players basically locked up for 6 yrs, which in most cases will be their prime (say mid-20′s to late-20′s/early 30′s)
teams can offer their free agents arbitration. if the player accepts, that means that again, an arbitrator would decide on the amount of a one-year contract, assuming the team and the player can’t agree on a contract. if the team doesn’t offer their FA arbitration (like the astros this year with clemens), that means 2 things: 1) they can’t sign that player until some time in may of next year and 2) if another team signs that free agent, the original team does *not* receive any extra draft picks from the new team as compensation. generally it makes sense to offer a player arbitration unless the team feels the arbitrator would award a contract larger than the team is willing to pay, even for just one year.
as far as trades, there aren’t really any rules around that like there are in the NBA, where the traded players’ salaries have to be within a certain % of each other. i think the only big thing is you cannot trade draft picks in MLB.
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