Yesterday, it was announced that the Major League Baseball minimum salary in the 2011 Championship Season will be $414,000. It is a $14,000 raise over the 2010 minimum.
Article VI of the 2007-2011 MLB Collective Bargaining Agreement (referred to as the “Basic Agreement”) deals with player salaries. Specifically, Section B of the Article contemplates Minimum Salary. The 2011 season is the last one that will be governed under the current Basic Agreement. Section B calls for a minimum salary “at the 2010 rate per season plus a cost of living adjustment, rounded to the nearest $500, provided that the cost of living adjustment shall not reduce the minimum salary below $400,000.” Later in Section B, the Basic Agreement explains how the new number is computed.
Cost of living adjustments for the Major League minimum salary described above in paragraph (1) shall be computed as follows: To determine the 2011 salary rate, $400,000 shall be multiplied by a fraction, the numerator of which is the Consumer Price Index for Urban Wage Earners and Clerical Workers published by the Bureau of Labor Statistics (CPIW) for November 2010 and the denominator of which is the CPIW for November 2008.
Based on my understanding of the CPIW, the numerator should be 214.750 and the denominator 207.296. That fraction, multiplied by $400,000, comes out to $414,383.30, which rounded to the nearest $500, actually equals $414,500. Was it just lazy reporting, or did the MLB actually make an error in its rounding, because every report I have read says that next year’s minimum will be $414,000.
Minor League minimum salary for players on their clubs’ 40-man rosters is set at $67,300 (up from 2010’s $65,000), but only players who have at least one year of being on the 40-man under their belt or at least one day of MLB service will be bound by the salary floor. For Minor League players on the 40-man roster who do not fit into either category (i.e. players just named to their teams’ 40-man rosters and without any MLB service), their minimum salary will be $33,700 (up from 2010’s $32,500).
