Baseball contracts and (re)negotiations

Factual Questions
1

I really wasn’t sure where to post this, but I believe this question can be answered factually. Mods, do what you will.

I’ve been in love with my MLB 07: The Show game for the last several weeks. In particular, the mode I spend most of my time playing is called Road To The Show. You are asked to create a player and set certain attributes for him, and then attempt to work your way through the minor leagues and hopefully have a successful career in the majors at some point.

So I created my player. He decided to try out for the Dodgers, had a good spring, and was offered a small contract. He spent most of the year in AAA and had an impressive year (I play in an easy mode that makes the game-play much more arcade-like), but the Dodgers did not re-sign. The following year, I tried out for the Marlins, received another one year contract, and was once again very impressive. I was called up to the majors early on and remained there for the duration of the season. I went to the All-Star game and ultimately won Rookie of the Year. (We lost Game 7 of the World Series to the Angels, if you’re interested).

As a result, the Marlins offered me a four-year deal worth $1.1 million over the life of the contract, which I accepted. 2009 was another productive year (a return to the All-Star game and lead the league in a couple of offensive categories), and then 2010 was my true breakout year. In this season, I:

  • won the Triple Crown
  • also lead the league in steals, OBP, slugging %, runs scored, hits and triples
  • broke the single-season records for home runs and hits
  • broke the all-time record for consecutive games hitting streak
  • received the NL MVP and World Series MVP awards (we beat the Yankees 4 games to 1)

Now, despite this unfathomable performance, when I began the next season, my contract remained the same. I’m entering year 3 of 4, and I’m scheduled to receive a little more than $300k in salary this season. And herein lies my question (finally).

I know I’m just playing a video game, but I’m wondering what would happen if this took place in real life. Say you’ve got a relatively young guy who has signed a multi-year contract, and in that time, has gone from showing clear talent to producing very well to being, far and away, the best player in the majors. Under such a circumstance, would the team be under any obligation to renegotiate his contract? Can he just walk away from it and sign with another team?

I have to imagine that in the real world, the team would voluntarily resign him at pretty much any dollar figure he asked for rather than risk angering him (and his agent) and having him go play for someone else once the contract expires. But would they have to? What options does the player have? Come to think of it, what do “options” mean in the sense of a baseball contract – I’ve never made an effort to understand that.

Many thanks in advance.

2

Unless the player’s initial contract included a clause which required renegotiation if specific performance benchmarks were reached, yes, in real life a upcoming player in his 2nd or 3rd year of a multi-year contract would not be entitled to a renegotiation.

Once you’re signed to a contract in baseball, you can’t really get out of it. If I sign a young player to a 5-year, $5m contract and there’s no clause allowing him out of it because of refusal to renegotiate, then the best he can do is refuse to play (and thus not get paid) for my team, he can’t sign with another team until his contract with me is expired.

In the real baseball world, there are two types of upcoming players. The first type are amateur players from the United States who are picked in baseball’s amateur draft (High School seniors or college players are the typical draftees.) When you’re picked by a team in the annual draft, that team retains negotiating rights to you for a period up until the week before the next year’s draft. The Seattle Mariners drafted Alex Rodriguez in 1993 after his senior year in High School. Ball clubs have a pretty good bargaining position at this point. Draftees either accept the contract the MLB club has offered them, or, they don’t get to play professional baseball that year.

In general drafted players are given multi-year contract offers @ league minimum salary ($300,000/year.) The rare superstar prospects can bargain for more starting salary or a larger signing bonus.

3

IRL, you can certainly ask to have your contract renegotiated, but that’s up to the club. However, nowadays teams want to keep young players happy, especially when they look to be big stars.

In a situation similar to yours, the Mets gave big contracts to Jose Reyes and David Wright last year. Both were making minimal (for baseball) contracts, and were not eligible to become free agents. However, since they were already all stars, the team was willing to pay substantially to keep them with the team.

If the club is reluctant, the player can always try to sit and refuse to report to the team. That’s pretty drastic, and it’s unlikely to help in the long run.

A contract is a contract. Once you accept it, you are bound to it.

4

No and no. Sign a multi-year deal and you’re stuck with it.

Multi-year contracts are rare for players with less than six years of Major League service. In the first three seasons, they are pretty much at the mercy of what the clubs are offering them. In 2001, Albert Pujols was an All-Star, Rookie of the Year, and finsihed fourth in MVP voting. His salary the next season was a modest $600,000. There are many other examples of this, including Manny Ramirez in 1995 and A-Rod in 1996.

After three years of service, a player is eligible for arbitration, and that’s when they tend to see a big jump. After six years, a player is eligible for free agency and, if he’s still playing at a high level, another quantum leap. A-Rod jumped from $4 million to $22 million as a free agent. Ramirez went from $4 million to $13 million when he used free agency to jump from Cleveland to Boston. In both cases, the players signed multi-year contracts during their arbitration period, getting a higher salary in years 4-6 in exchange for extending their deal one or two years into their free agency period.

5

Thanks for the responses, folks. It seems that in my case, I should have tried to negotiate a much shorter contract in the hopes of being better rewarded for my play from year-to-year. Sounds like the Marlins have got quite the bargain for the next couple of years. Lesson learned.

6

That works in a video game, but real life is a bit different. A longer term contract does provide the player with some guaranteed money in the event of injury or a decline in form. I would hate to tear a ligament in my elbow six months into a one year contract.

7

Oh, an excuse to tell my favourite sports holdout story!

Way back in the 1998-1999 NHL season, Alexei Yashin, captain of the Ottawa Senators, put up a 94 point season and finished second in voting for league MVP. Unfortunately for him, he still had one year remaining on a contract that paid him $3.6 million per season, well below the market rate for players of his caliber. Yashin demanded the deal be renegotiated. The team refused. Yashin sat out all of training camp. The Senators still refused to give in. Yashin announced that he would not play for Ottawa until the deal was renegotiated; the team told him to screw off and suspended him without pay. Yashin ended up missing the entire season. At the end of the season, Yashin declared that his contract was up and that he was a free agent. The Senators took him to arbitration, and it was ruled that Yashin still owed Ottawa one more year on his contract before it would expire. Yashin demanded a trade. The team refused again. And so, Yashin was forced to play one final year as an Ottawa Senator, being booed mercilessly by the home fans whenever he so much as touched the puck(in fact, he still gets this treatment 8 years later). And Yashin had to play at his best to justify a big contract at the end of the year.

Needless to say, no NHL player has ever held out while under a valid contract since.

8

Even so, given the salary structure of major league baseball, long-term contracts are almost never a good idea for young players.

Teams have little incentive to offer attractive long-term deals, because they have exclusive rights to young players for six years anyway. And unless the team makes a really attractive offer, a young player has little incentive to accept, because the player becomes arbitration eligible after three years, which can drive an enormous salary increase.

A second-year player signing a four-year deal, as per the OP, would be giving up two years of arbitration eligibility, during which a Rookie of the Year could reasonably expect to see a ten- or twenty-fold salary increase. The team would have to offer a lot more than $1.1 million per year to make this attractive.

True, the player with a one-year contract takes a chance on suffering a career-ending injury and not earning anything during the latter years. But career-ending injuries aren’t that common in baseball, and the relatively small risk can be covered with insurance.

Asimovian, next time get yourself a better agent!

9

Well, I suppose technically, I was the agent for my created player, so I hereby fire myself. :slight_smile:

Speaking of which, yikes to Rysto’s story! Who was this Yashin’s agent, and does he still work in the business?

10

It’s almost impossible, however, that a Rookie of the Year would be suckered into signing a 4-year, $1.1 million/year contract for their 2-5 years; no sane agent would allow it. You’d make more money than that just by waiting for arbitration eligibility. I could see three years at $1.1 million, maybe, because you only lose one arbitration year in return for $3.3 million guaranteed (as opposed to about $750,000 over two years of the MLB minimum) but, still, a young stud would almost certainly hold out for more.

Consider the contract signed by Eric Hinske immediately after winning the 2002 Rookie of the Year Award; to give up his arbitration years he had to be bought off with a five year deal worth close to $3 million a year.

11

Mark Gandler. Somehow, he still has business. Actually, I believe that he’s still Yashin’s agent, if you can believe that. Of course, I left out the postscript: Ottawa traded his rights to the Islanders, who promptly gave him a 10-year, $90 million contract. His production has been sinking ever since.

12

I hate to do this, because it will only serve to embarrass me further, but I have to clarify something. $1.1 million was the value of the entire contract, not a per-year figure. So it’s even worse than it looks.

In my defense, however, that was actually the most lucrative contract I was offered (out of four choices), so I will blame the game for failing to provide a realistic sum of money to my player. I think the problem is that because I was playing on such an easy mode, I produced far beyond what the game would have expected based on my players attributes at the time, and I think the attributes are how the game makes its calculations. For example, my player’s scouting report says that I am still a defensive liability prone to many errors, despite the fact that I won a Gold Glove this past season and committed only three errors the entire year.

Hopefully, by the time this contract expires, I’ll receive contract offers that better reflect how I’m actually performing in the game.

13

That’s below the MLB minimum. Since your contract violates the MLB Basic Agreement, you can get it voided!

14

This is called being Albert Pujols (except maybe for the years of service).

When his unrestricted free-agency was in sight, the Cardinals begged him to the negotiating table, (I think) played the hometown card a bit (he immigrated to MO), and paid him pretty much what he was worth on the open market.

15

This is a problem common to all baseball simulations, in that the computer AI struggles with how to rate the value of ballplayers; on top of that the AI’s ability or lack thereof to rate ballplayers then conflicts with the AI’s inability to gauge the short and long term on-field (and, where the simulation sllows, financial) needs of its teams. In virtually all baseball league simulations it’s ridiculously easy, if you learn the AI’s peccadilloes, to construct invincible super-dynasties.