There are some very real health reasons as to why the Major League Baseball Players Association could be hesitant to get back to playing baseball. Last night the UFC held their first event since the world of American-based sports shut down and a fight was cancelled from the card after one fighter and multiple members of his team tested positive for COVID-19 on Friday. Professional soccer leagues in both Germany and in Spain have had multiple players test positive in the last few days after attempting to get back to practicing, leading to an entire team needing to quarantine for the next two weeks in Germany, postponing games for the team. Some players in Major League Baseball have spoken publicly about the risk involved, both for them and their families, as well as for the team staff and stadium operations staff that may be at more risk for severe complications – or worse – from contracting COVID-19.
But there may be another issue that is involved later this week when Major League Baseball is scheduled to formally introduce a plan to get baseball started back up again: Salary. We’ve talked about it before here at Redleg Nation, but back in late March the two sides agreed to a pay scale for the 2020 season. It included an up-front lump sum of $170,000,000 to the MLBPA to distribute to their members and that was there whether a season was to be played or not. They also agreed that if a season were to be played, the players would get a pro-rated salary based on the number of games that were actually played, minus that lump sum paid out earlier.
Well, in the last two weeks we’ve began to hear that the owners want to change that deal because it’s clear that there aren’t going to be fans in the stands anytime soon, and even if they do eventually get to a point where some fans can come in – it’s going to be at drastically reduced levels.
Craig Calcaterra of NBC Sports is now reporting that NBC Sports has been told that “There is going to be a way” if owners seek further player salary reductions. The players are reportedly furious over this given that the two sides already agreed upon things six weeks ago. Calcaterra notes this within his article:
When Major League Baseball’s owners have received unexpected revenue windfalls in the past, be it from greater-than-projected attendance, massively-increased TV deals, or billion dollar paydays due to franchise sales or spinoffs of their digital properties, they do not renegotiate player contracts upward. There are not bonuses distributed when a team or the league has a better-than-expected year.
As such, the players argue, why should the players be expected to take pay cuts because this is going to be a rough year at the gate? Is this not a situation in which the league and its owners are demanding all of the upsides of good economic fortune but none of the risks of bad ones? As the old saying goes, are they not asking to privatize all of the profits but socialize all of the losses?
Those two paragraphs are followed up with some details about how it’s possible that even with no fans in the stands that Major League Baseball as a whole may still be profitable this year because of just how much television money is on the table.
Major League Baseball is said to be sending the plan, whatever it is, to ownership groups across baseball on Monday. If the owners vote to approve that plan it will be sent over to the players association on Tuesday for them to look at. It could be a very interesting week. As Arnold says in Jurassic Park: Hold onto your butts.
I just have a feeling the players hears aren’t in it this year. First it was being away from family. Second was the desire to pay in front of fans to help motivate them. Now it is money.
I just wish they would admit they are scared to play and stop dragging the fans along. At least allow the owners a chance to find players that are willing to take a risk in life and play. There are plenty of minor leaguers who are flat broke right now that would sign up in a heart beat
They aren’t dragging the fans along. They’ve literally not been offered a single thing yet.
We have a similar situation playing out right now in the meat packing industry. It isn’t working out real well for the packers, the employees or the public.
In my opinion, the players are not going to turn their backs on their seven-figure salaries (or some prorated portion thereof) indefinitely. You may have a handful of players who are truly fearful of the virus and will opt not to play this year and therefore opt out of their salaries.
As has been said elsewhere, there is too much money to be lost by both sides for there not to be some agreement at some point.
Everyone is not created equal. For example, why should Votto play this year given the money he has already made (>$100m)?
How about Kris Bryant? He’s made around $25M in salary coming into this year and famously was gamed out of year of service time by the Cubs. He could sit this season and in effect get back the “lost” year. He’d still be eligible for arbitration next year and a free agent for the 2022 season, same as now.
MLB could have a perception problem if several big name guys like these 2 sit out.
If they play, and he refuses to play, does he still get the service time added?
First thing to watch for is how much stuff hits the fan when the owners see the proposed scheme. And where to the TV folks come it?
I still don’t understand why they didn’t try to get past some of this us and them (and them) mentality by having a formal working group with representation from all stakeholders work on things from the get go.
All I care about if the season gets canceled is that players do not incur playing time, and do not apply for free agency next season. I get what the players are talking about, why should MLB reduce salaries in bad years while MLB profits in good ones, but considering games aren’t being played, no money is being generated. Give me a product on the field and we’ll talk about salaries and free agency. If MLB pays full salaries for a canceled or partial season then players need to delay free agency until they play a full season at the end of 2021.
The players are not getting paid if a season isn’t played beyond the up front money they already got. And the service time they will get has already been agreed upon if there is or isn’t a season. Guys that were due to be free agents after 2020 are going to be free agents whether a game is played or not.
And yes, money is still being generated. It’s not anything in the stratosphere as what would have been generated, but MLB is still bringing in revenue right now.
Like I said, I don’t care about the salaries as much as I do the fact that guys will walk next year and have possibly not played a single game. Seems like a bad deal to me, and timing could not have been worse. Reds were positioned to climb back out of the cellar and possibly contend for a playoff spot. Now, you not only deal with players losing skills from all this downtime, you also have to deal with losing others like Trevor Bauer to FA. And the Reds will surely lose out the most because they are already a small market team and don’t have the cash resources like the NYs and LAs to absorb the financial losses. Other players may not want to come to Cincy next season if they don’t produce this year. It’s going to be bad.
It’s absolutely going to play out this exact way. Zero questions about it.
It shouldn’t play out that way, because it’s ridiculous. But that’s how it will play out. It’s how it always plays out in every industry. The workers are never worth more and the bosses are always right. Always. Every time.
1. Because of the inability to quarantine I feel playing games in home towns so the players can be with family is very unwise. They need to be away from family in AZ or risk losing the season.
2. Some players don’t want to be away from family and that is their own personal decision. If they choose to opt out of the season they also opt out of their contract for 2020 and receive only their share of the 170 million promised earlier.
3. Owners blew it not negotiating thinking about loss of revenue due to attendance. Players should not pay for the owners lack of insight in negotiation.
4. I am not sure how many players will opt out of their 2020 season (point 2). But point 2 may neutralize the losses incurred in point 3. They would at least lesson the blow. That is if players were not all smoke and mirrors about their fear of playing this year.
You appear to be correct on #3, although we’d have to see the actual document to confirm that.
FA money, may not be big this, except for a few over the top players.
I think most will not opt out.
By the way, without fans I do not see how the Reds make payroll (without money in the bank).
The Yanks, the Dodgers, the cubs are probably fine. The Reds, the Rockies I doubt it.
I am sure the tv money will also be prorated.
By the way, I do not know more then anyone else on this post, just guessing (maybe Doug as someones year, and know more)
The tv money isn’t pro rated as long as they play enough games. They’ll get paid in full if they meet that minimum (we don’t know exactly how many games it is, and it does vary among the different contracts – Fangraphs had some information there about it, and noted that it’s very unlikely a team would not be paid in full assuming they did actually play games this year, even if they didn’t quite meet the minimum game threshold). Let’s assume the players get paid “half” of their salaries this year. That’s like $65M in known payroll. We don’t know exactly how the non-30-man roster guys will be paid, but even if we assume they get half of MLB minimum, then divide that in half because of just half of a season, that’s another $5M (and I honestly doubt they’ll get that much, but let’s just go with it) – the Reds player payroll is basically the same amount as the assumed FS Ohio TV deal is for this year. Add in what they would get from owning part of Fox Sports Ohio (they claim this isn’t baseball revenue, but come on guys), the playoff TV contract money, the national regular season TV contract money, and they are still making money selling merch – though I imagine that doesn’t move the needle much at all – and they should have no problem at all making payroll, much less being just fine. The teams that may actually be hurt are the teams who are still on their old local TV deals who are getting like $20M a year instead of $50+.
We’ve not agreed in the past as to how much risk was reasonable to accept to have an MLB season. However, I agree with just about everything here if they take the decision to play.
I can see both side’s of the argument between the players and the owners. It will be like this in lots of business for some time.
If the owners and players cannot come to an agreement, stop the rumors that something may happen and just shut down for the year. Let everyone that are part of team employees and stadium workers understand their situations so that they can survive as humans.
The players are the least of my worries for infection as they will have the support and means to limit there interactions with others and it is the others workers for the teams that are most likely get infected.
Being in New York and listening to the governor there will probably not be any sporting events (fans or non fans) going on in New York City for many months, My guess is there will be the lock down in NYC at least through mid- June if not into July. We should find out this week as the current order expires May 15th. I am hoping my area of the state which has a lower % of cases and has under 120 people in the hospital with over 2000 hospital rooms in the area will be allowed some freedom.
I have not been given a choice to work or not. I was told in April, you will furlough 2 weeks, 1 week in May and 1 week in June and I have been one of the least impacted people at my company as I support the sales team. There are others on 100% furlough for 10 weeks, some on 75% furlough and most 50% for April through End of June on top of a 20% reduction in workforce.
This is working for a company that had record revenue and profits for 2019 and hiring people all over the world every month for an expanding business which had a significant amount of cash on hand. The company was not struggling, everyone expected a 10% bonus corporate wide, now we are wondering at the current revenue if the company will exist by the end of 2020 with the current situation.
The hope is the world economy start opening and revenue starts occurring in June. If not furloughs and permanent layoffs will occur. My company is like millions around the world. If the US economy and WW economy does not start moving in the next 6 weeks, there will be hundreds of thousands for businesses closing due to lack of cash flow never to return with untold millions out of jobs.
Playing professional sports for TV revenue (mostly from cable/paid subscription services) will not matter as the TV revenue will not occur as people will be forced to stop paid TV services so that they have money for necessities. I wish I could get my MLB TV contract money back as I have already suspended by paid TV subscription due to the loss of household revenue.
Baseball owners and players can argue all they want about the money as whatever estimate they come up will probably be overstated anyway without a much wider opening of the general economy.
The cure (social distancing/lock downs) are killing the entire patient (human kind).
Sorry for the long rant.
I guess here’s my issue with your billionaires vs millionaires comment: Every single person that owns a team is worth hundreds of millions to several billions of dollars. Every single team has players on it that will absolutely play this season who have never been paid more than $12,500 in yearly salary. Take a guy like Sal Romano, who has played in parts of 3 seasons in the Major Leagues now. He hasn’t made $1,000,000 in salary in his career.
The players are already giving up a larger portion of baseball revenue’s because the season is shorter. Trevor Bauer explained that pretty well a little over a week ago (https://redlegnation.com/2020/04/27/reds-pitcher-trevor-bauer-im-very-convinced-there-will-be-baseball-in-2020/) – but the short version is that the playoff contracts are enormous, and the players barely get paid at all for the playoffs – this is where the owners gets huge benefits in terms of TV contracts vs pay for the players. So a shorter season means less paid out in contracts to the players and thus bigger take home of the overall revenue pie because of the huge profits from the playoff tv deal.
Don’t you think owners calculate in playoff revenue when they offer contracts? There are 3 or possible 4 major sources of revenue (and many minor ones). Post season revenue shared by all teams. During the season television/radio rights and ticket sales (also possibly concessions). Gone are the ticket sales and concessions. Reduced by 1/3 is the seasonal broadcast revenues. Post-season remains intact. A team such as the Reds and Rays may retain a good chunk of their annual Revenue but the Yankees and Dodgers make most of their Revenue off of broadcast right which will be dramatically impacted.
And by my calculation the Reds have paid Sal Romano in excess of $1.35 million thus far. Not bad for someone 26 years old. Hard to feel sorry for him.
Your calculations are incorrect. Sal Romano has less than 2 full years of big league service time.
Sal Romano has 1 year and 125 days of service time (see fangraphs). Slightly more than 2/3 of a baseball year. He received a $450,000 signing bonus (see Cot’s contracts).
545,000 x 1.67 + 450,000 =$1,358,333
I am not sure how any of this can be disputed.
Well, because you’re adding in a signing bonus when the statement made was about salary. He was just an easy example that I had of a player who I knew had less than two seasons of service time and had made under $1,000,000 in salary.
It is also not a given that the playoffs will be played in a “second wave” this fall, and the owners assume the risk of paying players fully without getting the playoff money. None of us have seen the contracts as to what is owed by what network (or local TV deal, for that matter), so all of this is rank speculation by all of us, including me.
They have to agree to something, or else they risk cooking the goose that laid the golden egg. I believe that MLB could well fizzle out altogether by 2030 if financial considerations scotch an agreement for this year. In a game of chicken, which is what they seem to want to play, there are 3 outcomes: (1) MLB blinks; (2) MLBPA blinks; and (3) the two collide and destroy each other. So, they have no real choice but to reach an agreement on what to do this year.
If they can’t reach an agreement, then they will try to sell it as due to safety/health reasons, but we all know that this is about money. If the NFL plays and MLB doesn’t, the institution of Major League Baseball will be finished as we know it.
There are a lot of options, such as spreading some of 2020 players’ salaries over future years. They could agree to set aside money for older coaches/umpire/employees (and those with health conditions) to sit out this year but still get paid something. Umpire Joe West, for example, is 67 years old and overweight. He doesn’t need to be out there, but they have to be careful about employment discrimination issues. But they need to reach an agreement of some kind.
Look, the president said it best. We needs sports to resume to help heal the country. It doesn’t have to be a thing of beauty. Just ask any old time who remembers world war 2 baseball. It just has be enough to provide a distraction and give people something else to talk about besides coronavirus.
I agree with Jim Walker. Filthy rich players like Joey Votto would be out of their minds to play again. But let the young guys play. They will be earning a living and providing some entertainment at the same time
We don’t need sports to resume to heal the country. We need people to be healthy to heal the country. Nothing short of that is going to heal us as long as people continue to get sick.
Yes, indeed. The health of the public must come first and that includes athletes and other auxiliary personnel and their families.