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Big Ass Roundup Of MLB’s New Labor Deal

The new labor deal that will extend to December 11, 2011 (mark it on your calendar) was completed and agreed upon at the end of October.

Instead of reporting about it along the way, I decided to wait until the dust settled and many different sources made comments about the deal. This post will serve as an official wrap-up and will hopefully provide enough information within a fairly short column. I’m going to leave the revenue sharing/tax parts out, since it does not have as much relevence for agents.
It was not the most enjoyable post to put together, but I figured since it’s the Thanksgiving holiday and I won’t be posting for a while, I might as well leave with a strong post.

  • Payroll threshold for the luxury tax in future years:
  • 2007 – $148 million
  • 2008 – $155 million
  • 2009 – $162 million
  • 2010 – $170 million
  • 2011 – $178 million
  • Minimum player salary in future years:
    • 2007 – $380,000
    • 2008 – $390,000
    • 2009 – $400,000
    • 2010 – $400,000 (speculation)
    • 2011 – $400,000 + 2-year cost of living adjustment
  • High school seniors and college juniors (and anyone else who is not a college senior) who enter the amateur draft early must sign by August 15th of that year in order to be eligible for that season [MLB labor peace assured through 2011]. < ~Hurts agents. Not as much time is granted for negotiation between agent/club. Holdouts are virtually impossible. Player bonuses may decrease.
  • If a first or second round pick is not signed by a team, that team will get the same pick in the next draft. If a third round pick is not signed, the team will get a pick between the third and fourth rounds of the next draft [New Baseball CBA Worse for Draftees and Minor Leaguers]. < ~Hurts agents. Their leverage is pretty much taken away in situations where they have a client drafted in the first three rounds. Before, if a club did not sign a player, that club lost out on the pick and got nothing in return. Agents could use this fact in favor of signing their clients that were drafted early. Now a club has the response of just waiting until the following year and adding picks to its arsenal instead of losing out altogether.
  • Teams that lose a Type C free agent will no longer receive any compensation. Teams that lose a Type B player will receive a pick between the 1st and 2nd round. Teams that lose a Type A player will receive a 1st or 2nd round pick from the team that acquires such player along with another pick between the 1st and 2nd round. Salary arbitration must be offered if draft pick compensation is to occur [New Agreement Includes Draft, Rule 5 Changes].
  • Teams now have protection from their players entering the Rule 5 draft for 4 to 5 years after a contract is signed [MLB, MLBPA reach five-year labor accord].
  • Signing the deal before December 19th (when the current deal expires) prevented a ninth work stoppage since 1972 [New labor deal might be reached soon].
  • Owners unanimously approved the new labor deal [Baseball owners unanimously approve labor contract].
  • Or if you want to see some funny clauses that were not actually in the new labor deal, go check out Provisions in the new MLB Collective Bargaining Agreement. I particularly like “The A-Rod Cap.”

    -Darren Heitner

    Have a Happy and Safe Thanksgiving!

    By Darren Heitner

    Darren Heitner created Sports Agent Blog as a New Year's Resolution on December 31, 2005. Originally titled, "I Want To Be A Sports Agent," the website was founded with the intention of causing Heitner to learn more about the profession that he wanted to join, meet reputable individuals in the space and force himself to stay on top of the latest news and trends.

    Heitner now runs Heitner Legal, P.L.L.C., which is a law firm with many practice areas, including sports law and contract law. Heitner has represented numerous athletes and sports agents as legal counsel. He has also served as an Adjunct Professor at Indiana University Bloomington from 2011-2014, where he created and taught a course titled, Sport Agency Management, which included subjects ranging from NCAA regulations to athlete agent certification and the rules governing the profession. Heitner serves as an Adjunct Professor at the University of Florida Levin College of Law, where he teaches a Sports Law class that includes case law surrounding athlete agents and the NCAA rules.

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