The COVID-19 epidemic has exerted unprecedented effects around the world. Thousands of people have perished, and once-booming industries are hurting from the economic downturn. Sports associations, especially MLB, face great uncertainty as to the viability of playing in 2020.
And the specter of that shutdown portends far-reaching future effects.
One such matter that could be drastically altered is the Collective Bargaining Agreement (CBA) negotiation that follows the 2021 season. Those talks were already slated to be a heated affair, with contentious items such as service-time manipulation, the Competitive Balance Tax (CBT), and free agency spending trends on the docket. Now, with an indefinitely suspended season and several concessions already fleshed out between union and owners, the 2021 dealings may hit another level of belligerence.
The owners and the Players Association agreed upon a handful of issues last week. Key among these were the $170 million advanced by owners to cover salaries should the season be scrapped. In exchange, the union will not sue for the full amount on guaranteed deals. Additionally, the owners agreed to award a full year of service time, allowing contract-year players to reach free agency in the winter, and younger players the ability to enter the team control phase.
In addition to these two compromises, several other concerns will surely be used as ammunition by owners in the 2021 CBA deliberations. For example, the Dodgers’ ownership group cannot be happy about the prospect haul traded to acquire Mookie Betts, should he not play a single game in Chavez Ravine. Owners who approved long term mega-deals, like the ones signed by Gerrit Cole, Anthony Rendon, and Stephen Strasburg, will be displeased with losing a year in the ever-important front end of the contract.
Will every negotiation in the 2021 CBA negotiations have the shadow of the suspended 2020 season looming over it? Will the owners lord the concessions they have made so far over the union’s head as reasons to not compromise on the issues raised in those discussions?
There has been much speculation as to which demands are most pressing for the players and the union. Players will prioritize settlements which allow them to maximize earnings. These could include earlier eligibility for the Rule 5 Draft, reaching free agency a year sooner, reaching arbitration a year sooner and with bigger raises year-to-year, and a higher minimum salary.
Owners may retort that a lost year of revenue which would help defray those costs is justification to deny such a request. Not only are owners potentially missing out on a year’s worth of earnings, they are also being penalized a season of service time. Losing a year of cheap team control, the Holy Grail of roster construction, could make owners much less amenable at the bargaining table. Perhaps this underlay the Yankees’ decision to send Deivi Garcia back to the minors, or keep Clarke Schmidt there entirely.
The luxury tax is always a hostile topic of disagreement between owners and players. A lost year of guaranteed salary for the league’s top earners, as well as a year of payroll savings for owners, may prompt the request of a salary floor. Owners may reply that the loss of a front-end year of multi-year deals would not only negate this request, but also rationalizes depressed earnings and shorter pacts for upcoming free agent classes, especially concerning veteran players.
The suspended season is a nightmare scenario for players and the union. This is not only because of a potentially lost opportunity to compete for a championship or to boost their market value, but because of the financial backlash from the owners in the looming CBA dialogues. Players will rightfully fear that the ripples of 2020 will color every discussion. Whatever happens in 2020, it will be the new elephant in the CBA mediation room.
Many solutions have been posed to keep the hope of baseball alive in 2020. Games could be played in empty stadiums, allowing TV revenue to still trickle in. Any form of baseball would be a godsend, not only for fans, but also for the players and the union to remove leverage from the owners in the pending CBA negotiations.