Wednesday, August 15, 2018
Tampa Bay Rays

Baseball owners, players union reach new labor deal

Baseball's owners and players saved themselves from the unnecessary evils of a first work stoppage in more than 20 years by agreeing Wednesday night to a new five-year labor agreement.

They really had no choice. Not with the game enjoying immense prosperity — annual revenues are approaching $10 billion — and popularity coming off the Cubs' World Series win. And not without major issues dividing them; the biggest were changes to the luxury tax system and draft-pick compensation for free agents.

The deal was reached shortly before 9 p.m., three hours before the previous agreement was to expire. Owners had threatened a lockout, which would have halted signings and trades, and suspended funding of player benefits but would have had little other initial impact. Instead, by reaching a tentative agreement, with some details to be worked out and language formalized, they extended the labor peace that has followed the acrimonious 1994-95 strike.

The changes to the deal are not overly significant. They seem to favor the owners and don't appear to do much to help small-market teams such as the Rays.

The players wanted a large increase in the $189 million threshold for the luxury tax, which serves for some teams as a de facto salary cap because they pay penalties for going over it. The increase instead will be marginal, to $195 million in 2017 and eventually to $210 million, with increases in the penalties paid for exceeding it. There also will be changes to the free agent compensation system, with signing teams no longer required to give up first-round picks but picks from lower rounds based on their luxury tax standing.

Two much-discussed topics that did not result in change were roster sizes — they will stay at 25 during the season and increase up to 40 in September — and implementation of an international draft, with teams instead having a set spending limit, reported to be $6 million.

Of interest to the Rays was talk of alterations to the revenue-sharing system that provides them money from other teams, but no major changes are expected.

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