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A Crash Course On MLB Free Agency

We are in one of the most exciting periods of the year for baseball aficionados.  With the culmination of the World Series, free-agency is quickly approaching.  Use this guide so that you do not become confused with how all the events go down.  Free-agency’s implications go well beyond the signing of those who become eligible.

Article XX of the MLB Collective Bargaining Agreement deals with the Reserve System.  Paragraph B specifically highlights Free Agency.  Any player with six or more years of MLB service who is not under contract for the following season may become a free-agent.  There is a procedure that players and their agents must follow.  A Player eligible to become a free-agent may give notice of his election of free agency within the 15-day period beginning on October 15 (or the day following the last game of the World Series, whichever is later).

The former club of a free-agent may offer arbitration by December 1 as long as that player has not yet signed a contract.  Only if the former team offers arbitration and the free-agent rejects and signs with another club at any time or he flat out signs with another team by December 1 minus the arbitration offer, may that team be compensated if said player signs elsewhere.

The Elias Sports Bureau is the official stat tracker for Major League Baseball, among almost every other major professional American sport.  Every year, ESB ranks National and American League players and places them into three categories.  The top 20% are considered Type A players, next 20% are type B, and the remaining players are labeled Type C.  ESB does not compile these rankings just for fun.  The MLB uses the results to determine compensation picks based on free-agent movement.  In compensation cases:

  • Type A free-agent: Former team will be compensated with the signing team’s first round draft pick and a supplemental first-round pick in the following Amateur Draft.  If the signing team finished the previous season in the bottom half of the standings, it will keep its first round pick, but give up a second round pick instead.  The former team will still get a supplemental round pick either way.  Additionally, the signing team does not give up a pick awarded as compensation for failing to sign a player in the previous draft.
  • Type B free agent: Former team only receives a supplemental first-round pick.
  • No compensatory picks are granted to an organization for Type C free-agents who sign elsewhere.

Since the World Series ended after October 15th, that date will be used to determine the free-agency declaration window (it is November 14).  Eligible players have fifteen days from last Thursday to declare for free-agency.  At that point, we will know how many Type A and Type B players will be in the free-agent pool.  This information is important, because clubs are limited in the number of Type A and Type B players they can sign based on the number of those types of players who elect to enter free-agency.  From the Quota section of the Collective Bargaining Agreement:

If there are 14 or less such Players, no Club may sign more than one Type A or B Player. If there are from 15 to 38 such Players, no Club may sign more than two Type A or B Players. If there are from 39 to 62 such Players, no Club may sign more than three Type A or B Players. If there are more than 62 such Players, the Club quotas shall be increased accordingly. There shall be no restrictions on the number of unranked Players that a Club may sign to contracts.

The caveat:

A Club shall be eligible to sign at least as many Type A and B Players as it may have lost through Players having become free agents under this Section at the close of the season just concluded.

One thing is certain: #1 on the ESB rankings, Mark Teixeira, has declared for free-agent status.  That is one Type A player to add to the total.  Here are the leaders by position and league:

American League
• First base: Mark Texeira, Angels (98.889)
• Outfield: Magglio Ordonez, Tigers (96.316)
• Designated hitter: David Ortiz, Red Sox (94.545)
• Catcher: Joe Mauer, Twins (89.401)
• Second base: Dustin Pedroia, Red Sox (85.714)
• Shortstop: Michael Young, Rangers (88.0)
• Third base: Alex Rodriguez, Yankees (95.031)
• Starting pitcher: Roy Halladay, Blue Jays (95.058)

National League
• First base: Albert Pujols, Cardinals (95.385)
• Outfield: Matt Holliday, Rockies (98.125)
• Catcher: Russell Martin, Dodgers (85.328)
• Second base: Chase Utley, Phillies (92.411)
• Shortstop: Jimmy Rollins, Phillies (85.714)
• Third base: David Wright, Mets (89.560)
• Reliever: Takashi Saito, Dodgers (88.678)
• Starting pitcher: C.C. Sabathia, Brewers (98.110)

Now let the games begin.

By Darren Heitner

Darren Adam Heitner, Esq., is a preeminent sports attorney and the founder of Heitner Legal, P.L.L.C., a Fort Lauderdale-based law firm specializing in sports law, contract negotiations, intellectual property, and arbitration. He earned his Juris Doctor from the University of Florida Levin College of Law in 2010 and a Bachelor of Arts in Political Science, magna cum laude, from the University of Florida in 2007, where he was named Valedictorian of the College of Liberal Arts and Sciences. Admitted to practice in the state bars of Florida, New York, and the District of Columbia, as well as multiple federal courts, Darren also serves as a certified arbitrator with the American Arbitration Association.

As an adjunct professor, Darren imparts his expertise through teaching Sports Law at the University of Florida Levin College of Law and Name, Image, and Likeness (NIL) at the University of Miami School of Law in the Entertainment, Arts, and Sports Law LL.M. program. His scholarly contributions include authoring several books published by the American Bar Association, such as How to Play the Game: What Every Sports Attorney Needs to Know, and numerous articles in prominent publications like Forbes, Inc. Magazine, and Above the Law. His thought leadership in NIL has earned him recognition as one of the foremost experts by The Wall Street Journal, USA TODAY, and On3, and he has been lauded as a “power player in NIL deals” by Action Network and a “top sports trademark attorney” by Sportico.

Darren’s passion for sports law led him to establish Sports Agent Blog on December 31, 2005, initially titled “I Want To Be A Sports Agent.” The platform, created as a New Year’s resolution, has grown into a cornerstone of the sports agency community, offering in-depth analysis of industry trends, legal disputes, and agent-player dynamics. His commitment to the field is further evidenced by his representation of numerous athletes and sports agents, as well as his prior role as an Adjunct Professor at Indiana University Bloomington, where he developed and taught a course on Sport Agency Management from 2011 to 2014.

Darren’s contributions have been recognized with prestigious honors, including the University of Florida’s 40 Under 40 Award, the University of Florida Levin College of Law’s Outstanding Young Alumnus Award, and designation as the best lawyer in Fort Lauderdale by Fort Lauderdale Magazine. He remains an active voice in the sports law community, sharing insights through his weekly NIL newsletter and his X posts, engaging a broad audience on legal developments in sports.

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