MLB, MLBPA Come To Terms On New CBA That Extends Labor Peace To Nearly 30 Years

MLB and the MLBPA last night reached a verbal agreement on a new five-year CBA before the midnight ET expiration of the prior deal. The new pact, which must be formally ratified by each side, operates largely within the framework of the old deal with various modifications and will cover the ’17-21 seasons. The luxury tax threshold, which has been at $189M since ’14, will shift to $195M next season and rise steadily to $210M by the ’21 season, with heightened tax rates for both first and repeat offenders. The new agreement did not produce an international draft or changes to the MLB roster sizes. However, a hard cap will be imposed on bonuses for foreign-born amateurs. Other highlights of the deal include:

• A new draft pick compensation system surrounding top free agents which will now force signing teams to surrender either second, third or fifth round draft picks and $1M in international bonus money, depending on whether a club is over the luxury tax. This is a reduction from the prior structure mandating the loss of a first-round pick. 
• A player will only be able to receive a qualifying offer once, and must sign a new deal for at least $50M in order for their former team to receive draft pick compensation.
• The season will start four days earlier than before and will allow for additional off days.
• The A’s will be phased out as a revenue-sharing recipient over the next several years.

LOOKING AT THE CHANGES: The AP's Ronald Blum reports the league that wins MLB's All-Star Game "no longer will get home-field advantage in the World Series." That will now "go to the pennant winner with the better regular-season record." Players participating in the All-Star Game beginning next year will "have the incentive to play for a pool of money." Meanwhile, the "minimum stay on the disabled list will be reduced from 15 days to 10."  An international play plan is "part of the new agreement that includes a payment schedule for potential games in Asia, Mexico, Latin America and Britain." There also will be "U.S.-based special events" similar to the Braves-Marlins game at Ft. Bragg last July (AP, 12/1). The AP's Hawkins & Blum report smokeless tobacco will be banned for all players who "currently do not have at least one day" of MLB service. The regular season also will expand from 183 days to 187 starting in '18, "creating four more scheduled off days." There are "additional limitations on the start times of night games on getaway days." The minimum salary gradually will rise from $507,500 in '16 to $555,000 in '19, with "cost-of-living increases the following two years" (AP, 12/1). Opening Day will "now take place in the middle of the week so as to allow for more off days during the season" (CBSSPORTS.com, 11/30). Roster sizes will "stay the same" -- 25 players through August, up to 40 in September -- despite thought they "would expand to 26 players through August and be limited to 28 or 29 in September" (N.Y. TIMES, 12/1). It is unknown whether penalties "will be stiffened for players violating the joint drug agreement or domestic violence policy" (USA TODAY, 12/1).

NIGHT CAP: USA TODAY's Bob Nightengale notes the "last obstacle" between the players and owners was "agreeing to a new luxury tax payroll threshold." Under the new terms, the Dodgers, Yankees, Red Sox and Tigers will still be over the limit in '17 (USA TODAY, 12/1). In N.Y., Ken Davidoff notes if a team’s payroll "climbs as high" as $255M in the final year of the CBA, it can be taxed as high as 90% for the overage, an "extreme disincentive" (N.Y. POST, 12/1). ESPN.com's Stark writes if the Dodgers do not get their '17 payroll under $235M, it "appears as if their tax rate would rise" to 92% as a third-time offender subject to a 50% tax plus a 42% "surtax" for being $40M over the threshold. Two MLB agents "used the term 'soft cap'" to "describe the effect of a rate that high." Stark: "No matter what you call it, it's the strongest deterrent to spending to ever appear in a baseball labor agreement" (ESPN.com, 12/1). In L.A., Bill Shaikin writes the Dodgers and Yankees -- the "only teams to pay the luxury tax more than once in the first four years" of the current CBA -- have "expressed a desire to reduce their payrolls so as to avoid the tax" (L.A. TIMES, 12/1).

WORKING THINGS OUT: ESPN’s Buster Olney reports both sides "got something they really wanted" in the new deal. The owners "wanted to have some sort of an international draft," and while that was not agreed to, there is now a "hard cap on spending on international amateurs, which essentially does the exact same thing." One of the players' "real focus this time around was on quality of life, on getting more off days during the season, having an easing on the travel that they do." Olney: "You’ll see them play more day games before taking long flights” ("SportsCenter," ESPN, 12/1). MLB Network's Richard Justice noted the "luxury tax negotiations were very intense," and the owners "got a little bit more cost certainty out of their Latin American bonus pools" ("MLB Tonight," MLB Network, 12/1). SI's Tom Verducci reported the issue of an international draft “from the union’s perspective that was a no-fly zone.” Once MLB “took that off the table, they were able to attack other things.” FoxSports.com's Ken Rosenthal noted talks "didn't really get going until (Tuesday) full-bore." The two sides were "always talking, they always had some parameters of certain things, but it finally accelerated" ("MLB Tonight," MLB Network, 11/30).

LOTS OF SIMILARITIES TO OLD DEAL: The WALL STREET JOURNAL's Jared Diamond notes the new CBA "won’t look all that different than the previous one" to casual fans, with almost all of the "more dramatic proposals falling by the wayside" (WALL STREET JOURNAL, 12/1). The N.Y. POST's Davidoff writes the new agreement’s "similarity to its predecessor reflected the game’s robustness and both sides’ belief that, all in all, life is good and should remain that way" (N.Y. POST, 12/1). But Rosenthal said, "The headline to me would be, ‘What took so long?’ There isn't any dramatic shift here." Verducci: "Why did it take this long? We are not structurally changing much at all as far as the on-field game itself. It looks like absolutely nothing has changed. The September roster mess is still in place, no pitch clocks. I think we will get something in regards to tweaking schedules to give players more days off and easier travel days, but the game on the field does not sound like it has been touched much at all” ("MLB Tonight," MLB Network, 12/1). In N.Y., Tyler Kepner notes the "slow pace of talks in recent weeks had frustrated some on management’s side." While both sides "wanted revisions to certain rules, there was no battleground issue that seriously threatened the industry" (N.Y. TIMES, 12/1).

AGREEMENT WAS PARAMOUNT: In N.Y., Joel Sherman writes the fact that there was "little seismic alteration in this new five-year agreement speaks loudest to why there had to be a settlement." Sherman: "Times are good for the sport and there was not the kind of issue on the table like imposing a salary cap that produces labor war and, ultimately, work stoppages" (N.Y. POST, 12/1). ESPN's Tim Kurkjian cited a source as saying that there were "no lightning rod issues out there that were so serious they were going to shut down a sport that is a $10 billion industry." Kurkjian: "Most of the owners are doing pretty darn well. Most of the players are doing pretty darn well. The game really developed the momentum from the tremendous postseason, the spectacular World Series we had. Baseball wanted to keep that momentum” (“SportsCenter,” ESPN, 12/1). MLB.com's Richard Justice notes owners and players "did the only thing that makes sense." Justice: "They kept riding the wave." There were "no dramatic changes, but none was needed." What they "didn't do was interrupt the game." The sides understood that MLB has "never been better than it is right now and that a work stoppage simply made no sense" (MLB.com, 12/1). SPORTSNET.ca's Ben Nicholson-Smith noted the changes allow MLB to "continue business as usual following a memorable" '16 season that included a "storybook ending" with the Cubs winning the World Series. MLB can now "build on that success, sustaining year-round interest as hot stove season reaches its peak ahead of the Winter Meetings" (SPORTSNET.ca, 11/30).  ESPN's Mike Greenberg: "The business of the sport has never been healthier. They’re rolling, they’re like an ATM." He added he did not believe "anyone was legitimately worried that it was going to bleed into Spring Training or bleed into the season" ("Mike & Mike," ESPN Radio, 12/1).