Final Offer Abitration Explaination..Finally!
In his third and final year of law school, SportsAgentBlog.com contributor, Jason Wulterkens, wrote a wonderful paper on Major League Baseball’s use of Final-Offer Arbitration (FOA). After noticing my latest report on FOA, Jason decided to send me his law school paper so that I may analyze it and break it down into its most important points for you all to digest. Here are a few of the points that I felt were worthy for you to read:
- Both players and organizations may file for salary arbitration without the other’s consent.
- Players with between 3-6 years of experience along with “super-two’s” (players with at least 2, but less than 3 years of pro service, who have accumulated at least 86 days of service during the immediately preceding system and rank in the top 17% of said class) can file for arbitration.
- Players with less than 3 years of experience (who are not super-twos) are still subject to the old “reserve” clause and have little to no bargaining power in salary negotiations.
- With his team’s consent, a player with more than 6 years of experience, who was not eligible for arbitration at the end of the previous season, may invoke arbitration.
- An arbitrator may only rule on the terms of a one-year deal. Multi-year contracts will not be decided through arbitration.
- A player may file for arbitration between January 5th and 15th and if it reaches a hearing, it will occur between February 1st and 20th.
- In the actual hearing, each party is limited to 1 hour of initial presentation, and 1 half hour of rebuttal and summation.
- The arbitrators may consider only particular criteria in deciding a player’s salary, typically including:
- The player’s performance during the past year.
- The length and consistency of his career.
- The salaries of “comparable”players.
- His team’s on-field success and attendance numbers, the latter of which is considered legitimate indicia of the player’s public appeal and acceptance.
- Team profitability and market size cannot be considered in the hearing.
Hope you appreciated my effort to turn Jason’s excellent twenty page paper into about a page of bullet points! Arbitration season is officially over. Check in tomorrow for a little recap on how the hearings turned out and some highlights over the past couple of weeks.