There is no end in sight for the MLB lockout

On last Thursday, it came out the Major League Baseball would not be submitting a counteroffer to the MLBPA and that it requested federal mediation. This came after a heated 90 minute meeting in which there was virtually no movement towards a deal. With the players history with NLRB mediators, and the fact that their rulings are not binding, it came as no surprise when the union essentially told the owners to stuff it.

The mediator would have to be brought up to date on all the issues and problems that the two parties are negotiating over. Last time there was a labor stoppage (the ’94 strike), the two parties did go to a federal mediator and the recommendations was an absolute disaster for the players union.

“It was a joke. It had no value,” said Don Fehr, head of the MLBPA during the 1994-95 strike. “And there were all kind of agendas at work in the mediation that had nothing to do with the agendas of the parties trying to resolve the dispute.”

Said another top lawyer at the union, Gene Orza: “They came in with what they thought was a halfway proposal, which the owners jumped all over. The owners approved the mediators’ proposal in about a minute and a half.

“The guy virtually eliminated free agency. They just didn’t know what they were doing. That was obvious.”


If the owners were serious about finding a mutually beneficial agreement, a federal mediator wouldn’t be on the table. The mediator would waste time as they took weeks to come to understand the issues and then it would take even more time for them to work with both parties before they even considered a recommendation. The entire process would only delay the start of Spring Training and would (almost) definitely lead to a delay to the start of the regular season.

MLB’s recommendation to go to a mediator looks like a PR move. It makes the league look like they’re trying to find a middle ground while the offers its pitched to the union haven’t moved towards a middle ground.

The issues

The issues confronting MLB and its players union are wide and primarily focused around the economics of the game. Players used to be able to rely on a large paycheck after their athletic prime, if they made it in the league, to be able to cash in; but because of analytics, teams aren’t really shelling those contracts out to players in their mid- to late-30s anymore. That means that the players want more money earlier in their careers and they also want to hit free agency sooner; they also add a pre-arbitration bonus pool that’s available as well.


MLB has responded to this by proposing to ditch the arbitration process and let players hit free agency at 29.5 — no matter how much service time the player accumulates. While this would be beneficial for the late bloomers, for those — like Mariners’ star prospect Jared Kelenic — it would stick them with their rookie deal without the prospect for the performance based raises through arbitration.

There was proposal, from the union, to allow some players to reach free agency without six years of service time; but it was a non-starter with the owners and the players tabled it. So far it seems like there won’t be any major movement on the free agency and arbitration process…but the league’s proposal for free agency at 29.5 appears to still be on the table.

As for the pre-arb bonus pool, both sides agree to add it but they are no where near an agreement on the size of the pool — the players want it to be at $100 million (which is $5 million less than the union’s initial proposal), the owners want it at $10 million. That gap between the size of the pool is just a small sample of the gulf between these two parties that their negotiating on.

The players have won a minor concession from MLB as the league has proposed an increase in the minimum pay — 0 to 1 year of service will now earn $600K, 1 to 2 will be at $650K, and 2 to 3 will be at $700K. And those numbers are important to remember, because while there are players who earn eye popping nine figure salaries the majority of players are at or near the league minimums. It’s these players on the margins that are absolutely hosed by the current arbitration structure and their situation would be made even worse by the league’s proposal to ditch it entirely.


But the biggest sticking point appears to be revenue sharing. The players want to reduce the amount of money that flows to revenue the franchises via revenue sharing as they believe it allows teams to operate with a profit without requiring the teams to invest adequately in their product. There is absolutely no indication that the league is willing to move on its current model for revenue sharing; meanwhile the players have made a couple adjustments to their proposal for changes to the revenue structure.

Also on the table are issues of an expanded playoff (yes, please), pace of play (that’s not the problem, Rob), and a few other side issues that are aren’t core to the problems both parties are far apart on. With both sides being so far apart, its hard to see Spring Training starting on time and that could impact the start of the season.

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