During the offseason we chronicled how hard a line teams have taken in free agency when, theoretically, players have the most leverage they’ll ever get. During spring training, as contracts were being renewed, we talked about how hard a line teams are taking toward players in their first three years of service time, when teams have full control of salaries and players have no leverage.
Today at The Athletic, Marc Carig talks about that middle period, arbitration, in which there is, again, theoretically, equal leverage between clubs and players when it comes to the setting of salaries. A scripted-out process in which offers are exchanged, settlement is strongly encouraged and, if no settlement can be reached, a hearing is held to set the salary.
Except, as Carig notes, the sharp, zero-sum tactics clubs have taken in free agency and with pre-arb players is now filtering into arbitration as well. Rather than negotiate — which the system was intentionally set up to encourage — clubs are increasingly making arbitration a fully-adversarial process, adopting the file-and-trial strategy as a means of avoiding negotiations. Teams have increasingly coordinated — which is allowed in arbitration — and have established recommended limits to settlement numbers and have signaled to one another that it’s better to fight over pennies in arbitration than settle for a penny over the recommended figure. While agents can coordinate too, they are outgunned in money and manpower and, because they compete against one another for clients, the cannot match MLB’s lockstep approach.
If you think this is anything other than a challenge to pay the players as little as they can legally get away with, get a load of this:
The Belt changes hands shortly after season’s end, in a crowded conference room at a luxury resort, where delegates from every MLB team have been summoned for a symposium on arbitration. For three hours, they will work together at the direction of the league to set recommendations, which teams will use in negotiations with their players. It’s a thankless job. So before the meeting adjourns, they’ll celebrate an unsung hero in this battle over dollars. The ceremony ends with the presentation of a replica championship belt, awarded by the league to the team that did most to “achieve the goals set by the industry.” In other words: The team that did the most to keep salaries down in arbitration.
Yes, an actual belt. There have been rumors about this for some time — when I went to that arbitration competition last year I spoke to people who mentioned it — but thanks to Carig’s excellent reportage, Major League Baseball has now admitted that that’s a thing.
Whenever money matters come up, people who take ownership’s side said say “hey, it’s a business.” What they fail to understand is that while, yes, it’s all about the money, in some respects beating the players and holding down salaries as much as possible is a game to them too.
UPDATE: Tony Clark and the MLBPA have weighed in: