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Looking at the Yankees’ upcoming contract options

A few key Yankees have interesting decisions with their upcoming option years.

League Championship Series - New York Yankees v Houston Astros - Game Two Photo by Bob Levey/Getty Images

There’s been a lot of buzz about the Yankees’ upcoming offseason, in which several important players (DJ LeMahieu, Masahiro Tanaka, James Paxton) will be free agents. However, there’s been less attention given to the Yankees with upcoming contract options. The list of players includes more key contributors, including Zack Britton, Brett Gardner, J.A. Happ and even Giancarlo Stanton. If any of these players exercise their opt-outs, the Yankees could stand to lose quite a bit of talent, or be forced to pony up more money.

Before we get ahead of ourselves, it’s worth pointing out that we already know how two of these options will go. First, the elephant in the room. Although Stanton could forgo the remaining seven years and $218 million guaranteed to him for his age 31-37 seasons, he’s extremely unlikely to do so.

Stanton’s option is strictly a player option. Unless he thinks he can get more than $218 million on the open market in a down baseball economy and coming off of an injury-plagued season (which he won’t), he’ll be staying in pinstripes for a long time. Because Stanton will almost certainly not opt out, the Marlins will also have to start paying the $30 million they pledged in the trade, which will come in twice-yearly installments of $5 million from 2026-2028.

We can also guarantee that J.A. Happ will hit the open market. His option is a vesting option, which would automatically kick in if he threw 165 innings or made 27 starts. Ordinarily, Happ would have had a shot to hit those figures – he has averaged 30 appearances and 168 innings since turning 31, which is remarkable durability for an older pitcher. But due to the shortened season, Happ’s option will not vest into another year with the Yankees at $17 million, and he will instead hit the open market at age 38.

That leaves Britton and Gardner, and this is where things get interesting. The structure of Britton’s contract is a Scott Boras special. Britton signed a three-year, $39 million contract with the Yankees, but he’s technically only guaranteed two years at $26 million. After the 2020 season, the Yankees have to exercise or decline a team option for the 2022 season. If they exercise it, they will have Britton the next two years, making the contract a total of four years and $53 million. However, if they decline the 2022 option, they don’t necessarily still get Britton for 2021 – Britton can opt out of his deal right then and hit the market before the 2021 season.

So, to simplify, there are three possibilities for Britton after the 2020 season:

  1. The Yankees exercise his 2022 option, thus locking him for up for two additional years for a total of $27 million.
  2. The Yankees decline his 2022 option, but Britton exercises his player option, sticking with the Yankees for the 2021 season at $13 million.
  3. The Yankees decline his 2022 option, and Britton declines his player option, hitting free agency and ending his contract with the Yankees.

What actually happens might depend on if there’s baseball in 2020 and how each party views the baseball economy. The Yankees might be comfortable committing the two extra years for Britton because he’s reliable, but they might also not want to commit more money to 2022, a period in which big contracts for Aaron Judge, Gleyber Torres and Gary Sanchez might be in the offing.

From Britton’s perspective, 2021 is a terrible time to hit the open market unless he absolutely lights it up in 2020 and thinks he can make more than $13 million yearly. Given where baseball’s economics are right now, I’d guess that Britton likely stays with the Yankees in 2021, though the Yankees might not pick up his 2022 option.

As for Gardner, things could get messy. The uncertainty surrounding the 2020 season really isn’t a good situation for older players on year-to-year commitments like Gardner. His future with the Yankees depends largely on his continued performance and the Yankees’ continued need for outfield depth. With no baseball, there’s no way to evaluate either Gardner’s talent or the team’s need for his services. Stanton, Judge and Aaron Hicks are the team’s regular outfielders, Clint Frazier is still around, and so is Mike Tauchman. How comfortable would the Yankees be guaranteeing another year at $10 million to what would then be a 37-year-old Gardner?

Gardner’s option is strictly a club option – he has no say in whether or not the team picks it up. I’m not sure the Yankees would be willing to commit another $10 million to Gardner next year, unless he has a really strong 2020 campaign. They might still be interested in him at a lower rate.

There’s another wrinkle here – Gardner’s $2.5 million buyout. If the Yankees don’t want him next year at $10 million, they must buy him out for $2.5 million. Thus, if the Yankees are going to re-sign him, they’d want to get him at a salary less than $7.5 million – otherwise, they’re still spending the $10 million, which defeats the purpose of the buyout.

Like Britton, there are three contract possibilities for Gardner’s option:

  1. The Yankees exercise their 2021 club option, keeping Gardner around for $10 million.
  2. The Yankees decline the option, buy him out for $2.5 million, and then re-sign him for less than $7.5 million in AAV.
  3. The Yankees decline the option, buy him out for $2.5 million and Gardner signs somewhere else.

This is all contingent on Gardner wanting to play in 2021 at age 37. Technically, there is a fourth possibility – Gardner retires after the 2020 season. If there is a season and the Yankees win the World Series, maybe Gardner hangs up his spikes. But, with the season’s status uncertain and Gardner still looking like he could play a little longer if he wants, I wouldn’t bet on Gardner walking away. Although I desperately want to see Gardner win another title with the Yankees, something CC Sabathia didn’t get the chance to do, the forces at play could lead him out after the 2020 season.

The Yankees’ offseason decisions extend far beyond LeMahieu, Tanaka and Paxton. They have a real issue to consider with Britton’s future, as well as Gardner’s. For the Yankees’ sake, the more baseball played in 2020, the better. These veterans are presently key pieces to the team’s championship-contending core, but not all of them may be around in 2021. Given the uncertainty around baseball’s future, the 2020 season might end up being one last ride for some of the Yankees’ veteran pieces.