The Yankees recently announced their arbitration figures, agreeing to terms with all their eligible players, save one. Dellin Betances is still without a contract for the 2017 season. The team filed at $3 million, while Dellin’s side countered with $5 million for his first time through arbitration. The expectation was that they would ultimately meet in the middle, but that never happened. The deadline for agreeing to a new contract passed, and now the two side will head to an arbitration hearing in a few weeks.
It’s difficult to say who is being unreasonable in this situation since we aren’t privy to what goes on at the negotiating table. Arbitration figures typically go by a 40/60/80 model, where players in their first year of arbitration generally receive 40% of the value of one Win Above Replacement, and then it goes up from there. In 2016, one win was worth about $8 million, so if the Yankees are looking at 40%—which they definitely are—Dellin would be owed $3.2 million for his first arbitration year. Brian Cashman even seemed to confirm this line of thinking when asked about the situation by the media:
"We'll go out and just basically have a polite discussion about market value and history of where the marketplace sits versus attempts for new market creation.”
The problem, of course, is that the 40/60/80 model rarely works as anything other than a general baseline. There are just too many players, with too many exceptions, who break the mold. The man who developed the model in the first place, Tom Tango, even believes that it can’t be used on individual players and “if you look at specific players, you really should look at ‘comps.’” If there is any player on the Yankees that embodies a split from the conventional, to the point where the 40/60/80 model does not apply, it would have to be Dellin Betances.
It’s easy to be someone who sides with the team. Humans in general seem to gravitate toward the establishment, likely because it is safer and more secure to believe in order under rule than the alternative of fairness built on chaos. The Yankees, with their money under lock and key, are the establishment, and the establishment can always stand to spend more money than they actually do. That’s not to say that the team should just give Betances whatever money he wants because, technically, they can afford it, but maybe they shouldn’t be playing hardball with a homegrown talent as skilled as Dellin.
This is not the first time the two sides have disagreed over a contract. Just last offseason, in his last season of pre-arbitration, Dellin’s representation was unhappy with the contract the Yankees offered their client. Pre-arbitration players have absolutely no leverage when it comes to how much they get paid. Most teams have their own formula that they stick to with bonuses for experience, performance, and accolades mixed in. Despite what it would mean for him in the end, Dellin’s agent reportedly told him to decline the team’s contract offer. As a result, he was paid the same amount of money he had made the year prior without receiving a raise, which is just uncommon enough to raise eyebrows around the league.
The issue between the two sides likely came down to the team’s decision to suppress Dellin’s financial earnings when you compare him to other Yankees players. If we look at Adam Warren’s arbitration numbers, we see that he received a 7.52% pay increased in his second pre-arbitration season, and then he received an 8.57% increase for his third. Warren is by no means an equivalent talent to what Betances has done over the last three years, and yet Dellin was given a mere 1.08% increase after his breakout 2014 season before being offered just a 6.4% raise for the 2016 season. This is what they mean by a matter of principle: Dellin Betances should have been paid far more than he has been over the last two seasons, and now he wants to make that money up in arbitration.
If arbitration is really powered by comps instead of a baseline model, then Dellin’s side had to get their $5 million value from somewhere, right? Well, it’s likely that they got it from his teammate Aroldis Chapman, when the lefty earned $5 million in his first arbitration experience with the Reds.
This could be the comp Betances' camp is using. Is four years worth of inflation enough to make up for lack of saves? pic.twitter.com/v9l51FYoIC— Mike Axisa (@mikeaxisa) January 14, 2017
Despite what the Yankees might think a name brand is worth, Betances and Chapman were remarkably similar over the pre-arbitration years of their careers. In many instances, Dellin has proven to be a better, more durable, and far more valuable pitcher than Chapman. In the end, it just comes down to the saves and how valued they are. The Yankees, of course, will be banking on them being considered incredibly important, since they have often gone out of their way to prevent Betances from recording saves.
This all isn’t to say that the Yankees are doing something bad, since it is entirely within their right to offer what, and spend how, they want. It just seems questionable that they would go against their own self interests by alienating one of their best homegrown players for what really amounts to pocket change for them. The Pirates did the same thing to Gerrit Cole, choosing to give him the same base salary after his All-Star 2015 campaign, and the team’s ace at the time was not happy. It made people wonder if this was the best way to go about your business if you are the Pittsburgh Pirates and maybe want to have a chance at keeping your young talent around longterm.
The Yankees are threatening to cause the same kind of issue here, but then again, this seems to be par for the course for them. The organization seems to regularly play games with their own players, while overvaluing those on the outside. When they decided they didn’t want to re-sign Robinson Cano, they lowballed him and then ran him out of town. Then, using nearly the same amount of money, they overspent on Jacoby Ellsbury instead, and that deal has turned out great. They just went big on Aroldis Chapman this offseason, and now here they are, fighting over what could be a difference of $1-2 million.
Yes, Dellin Betances is going to make a few million this season no matter the outcome, but in terms of his market value in the system that is Major League Baseball—where dollar value has been outlandish for nearly 30 years now—this is peanuts. The Yankees haven’t been to a hearing in nearly 10 years, and they decide to break that streak with one of their most important pitchers. If this team was able to come to terms with Chapman last year, with the uncertainty of a looming suspension, they should have been able to settle with Betances.
The Yankees are holding firm on this for a reason. It is unlikely that Dellin gets the $5 million he asked for because he doesn’t have that precious save total, but his side likely already know that is a possibility. Even if $4 million was their target all along, you always want to aim high in negotiations. All the Yankees had to do was meet them half way, but they couldn’t even do that. Right now things seem to be civil, but it could get ugly in the near future. This will be a storyline to watch over the next few years.