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Two issues imperatives for MLB’s next CBA
DANIEL W. WERLY
ROBERT S. BRESSLER
Law Bulletin columnists
Published: April 20, 2015
Two issues that have dominated the Major League Baseball offseason are the process for signing international amateur players and service time considerations related to the promotion of top prospects. Both of these issues should be front and center when MLB and the MLB Players Association negotiate a new basic agreement.
Both issues have a significant impact on the game.
Attachment 46 of the collective bargaining agreement (which expires on Dec. 1, 2016) sets out the protocol for teams to sign amateur international free agents. The CBA defines international amateurs as players from anywhere except the United States, Canada and Puerto Rico and who are 22 years old or younger (players 23 or older who have not played professionally for the requisite period of time are also considered amateurs).
Under the CBA, each team is permitted to spend a specific amount of money on international amateur free agents — based on a team’s record the previous year — and are assessed penalties for going over that amount.
One major goal of the international protocol was to foster competitive balance between small- and big-market teams, but that goal has not exactly been achieved. Big-market clubs have been more than willing to blow past their annual allotment and pay the penalty fee (along with being subject to restrictions on future signings) in order to sign top international amateurs.
The most recent example is the signing of heralded 19-year-old Cuban second baseman Yoan Moncada by the Boston Red Sox. The team signed Moncada for a reported $31.5 million and will have to pay a 100 percent penalty fee — $31.5 million — on top of that.
Boston’s signing of Moncada has caused many to voice continued support for an international amateur draft similar to or included with the current domestic draft that takes place in June. Such a draft has been contemplated before and is even referenced in the existing CBA, but actually implementing an international draft should be a top discussion point between MLB and the players’ union as they negotiate the next CBA.
Next, pursuant to the CBA, a player can become a free agent (and thus eligible to sign with any team) after logging six years of service time in the big leagues. This six-year service clock is closely monitored by teams, as delaying the promotion of a top prospect can give teams an additional year of control over a player (through a fourth year of arbitration) before he becomes a free agent.
The issue has dominated spring training this year due to the Chicago Cubs’ decision to keep super-prospect Kris Bryant in the minor leagues for the beginning of the season, delaying the start of Bryant’s service clock and resulting in an additional year of team control.
Bryant, who was the second overall draft pick in the 2013 amateur draft and won nearly every minor league player of the year award in 2014, led all of spring training with nine home runs (second place has six).
Bryant’s agent, Scott Boras, has openly criticized the system for incentivizing teams to delay promotion and not placing the best team on the field from the beginning of the season.
Regardless of what happens this year with Bryant, MLB and the union are likely to tweak the current system in the next CBA, if not sooner.
Many proposed changes have been bandied about, including a recent proposal by ESPN’s Keith Law that a team who places a true rookie on its opening day roster would later have a chance to match one-year offers from other teams in the additional year of control the team would have gained had it delayed the player’s arrival in the big leagues by a few weeks.
This proposal would, in effect, allow the player to become a restricted free agent for one year to seek a market rate for his services while still allowing the player’s team to retain a certain degree of control for that year.
Until this service time issue is resolved, teams will continue to be conflicted about placing top prospects on their opening day rosters.
Daniel Werly is an associate in the business litigation and dispute resolution practice group and member of the sports industry team in the Chicago office of Foley & Lardner LLP. He focuses his practice primarily on sports-related litigation and NCAA compliance issues, including defending teams and leagues in complex litigation. He can be reached at dwerly@foley.com.
Robert Bressler is a litigation associate in the Chicago office of Foley & Larder and is a member of the firm's sports industry team. He focuses on complex commercial litigation matters, including breach of contract claims, breach of fiduciary duty claims, employment disputes, securities disputes and sports litigation. He can be reached at rbressler@foley.com.