Grim news broke Thursday regarding the ongoing baseball work stoppage: Major League Baseball has requested the assistance of a federal mediator to help resolve the landlord-imposed lockdown, according to Jeff Passan from ESPN. The players responded to MLB’s request on Friday afternoon:
Evan Drellich from Athleticism also signaled that MLB would not make a counterproposal, although it told the union it would.
Spring training will almost certainly be delayed, and the two teams have less than a month to strike a deal to start the regular season on time.
Disagreements on several fundamental economic issues are what are delaying a new collective agreement. Most of the issues are of interest to Phillies players, management and, believe it or not, the fans. Here’s a look at some of those issues that are having the most impact at the local level.
Collective bargaining tax
In 2021, the Phillies finished about $600,000 under the $210 million luxury tax. Players are concerned that teams are treating the collective bargaining tax as a salary cap and they can look no further than the Phillies for proof.
“That’s what I’m not going to do” Phillies managing partner John Middleton said after the 2019 season. “I’m not going to exceed the luxury tax so that we have a better chance of being the second wild-card team. It’s not going to happen.” Andy MacPhail, former Phillies president offered a different take just a few months later, saying, “It’s not an impenetrable barrier, far from it. It is my hope and, frankly, my expectation, that we will exceed it this year. Alas, there was some disconnect there and the Phillies never paid the tax in 2020, a year in which luxury monetary tax penalties were suspended due to the COVID-19 pandemic. You can argue that the team’s reluctance to spend beyond tax on helping in the bullpen and other areas cost them a playoff berth.
In all likelihood, the luxury tax is here to stay in the next collective agreement. Owners want a $214 million threshold that would rise to $220 million in five years while gamers are proposing a $245 million luxury tax for 2022, which would reach $273 million in 2026. If the tax increases significantly, the Phillies should be able to acquire two starting outfielders and at least one additional bullpen arm this offseason while remaining comfortably below the threshold. Maybe they’d have room for an extra pitch or some other splashy expense, either in free agency or at the trade deadline. If the owners get what they want, the Phillies would have about $30 million to spend before hitting the tax threshold. Assuming at least one outfielder will cost around $20 million a year, the Phillies will have around $10 million to meet additional needs if they plan to stay under it again.
Of course, staying under the tax is a choice. As part of the latest CBA, teams that exceeded the threshold for the first time were imposed 20% on openings with various surcharges for those exceeding by $ 20 million or more and draft penalties for those who do not. exceed more than $40 million. Tax rates increase as teams go over consecutive years, but penalties are reset once a team falls below the threshold at the end of a season.
Owners want to make tax penalties even harsher while players want them to be more lenient. The league, for example, wants 50% charge on overs and forfeiture of third-round pick and money from the international bonus pool for teams that exceed the tax.
MacPhail added in 2020 that “…no one can live longer [the collective bargaining tax]. The penalties are too harsh – not just economically, but they catch you anyway. If the luxury tax penalties get even worse in the next CBA, you can bet the Phillies will keep spending up to the self-imposed tax limit.
One of the union’s stated goals in this round of CBA negotiations is to get young players paid earlier. MLB and the union have agreed on a bonus pool for players eligible for pre-arbitration, but there’s a $90 million gap between the two sides on the amount of money available.
The union wants to extend eligibility for salary arbitration to all players with at least two years of service. Under the previous system, players who are in the top 22% of service time among those between two and three years of service become eligible for arbitration under the “Super Two” class. Every player between three and six years of service is also eligible to negotiate their salary through arbitration.
Ranger Suárez and Sam Coonrod are the only two players on the Phillies roster between two and three years of service. If the players get salary arbitration for all players after two years and it goes into effect this offseason, both pitchers will receive a raise for the 2022 season. Suárez is an interesting case because he missed the ” Super Two” of about four days. Under the old deal, Suarez will return the league minimum in 2022, but if the ‘Super Two’ class grows slightly or the players are able to get arbitration earlier for all, the Phillies southpaw could get a seven-digit increase.
When Nike shelled out the extra cash to get the swoosh down the center of MLB uniforms, you knew the ad patches were coming soon. The union has showed a willingness to let the league sell ads on the shirts, pending the acceptance of proposals from other players. That’s more money for the league, but an eyesore for fans who love a clean baseball uniform.
So what will a Phillies sponsored shirt patch look like? We know little about where these patches will go on the uniform or who will be vying for the sponsorship deal. GIANT and “Citizens” would likely be the betting favorites, but Tastykake looks to be the way to go. With our luck, we’ll probably get some weird crypto sponsorship that everyone hates.
In part two, we’ll look at the expanded playoffs, designated hitter, and whether or not the regular season will start on time.
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