Group Created with Sketch.
Volume 21 No. 22
  • Created with Sketch.
  • Created with Sketch.
  • Created with Sketch.

MLB players receive $125M from union

Major League Baseball players in 2017 collectively received more than $125 million in checks from their union, much of it representing several years of withheld licensing revenue. But amid a labor relationship with MLB management now growing more tense, it could be the last such distribution for quite some time.

 

The MLB Players Association’s 2017 annual report, filed recently with the U.S. Department of Labor, showed the large-scale distribution to players last year that jumped significantly from a comparable figure of $7.4 million in 2016. The outlay is in keeping with typical union practice, as the MLBPA, like many sports unions, saves money from group licensing efforts in escalating amounts during labor negotiating cycles and then redistributes the funds once a collective-bargaining agreement has been reached. A similar MLBPA distribution of nearly $132 million in withheld licensing revenue happened in 2012.

MLBPA Executive Director Tony Clark said the union may retain more revenue in coming years as it heads toward the next round of talks on a new labor agreement.
Photo: getty images

Following the completion of the current five-year labor deal in late 2016, MLB players last year received as much as $107,000 each, based on factors such as service time and participation in special promotions, up from individual outlays of up to $20,000 in 2016.

MLBPA Executive Director Tony Clark indicated the savings activity, concentrated primarily in U.S. Treasury securities and other investments, may be amplified during the upcoming three years leading up to the next round of bargaining in 2021.

“It is likely the players will retain more moving forward,” Clark said via email.

Since last fall, league-union tensions have risen significantly, due primarily to a sharply depressed free-agent player market last offseason that was among the slowest in more than a generation.

Clark declined to go into further detail on the planned saving activity, and decisions in this area are often made during the union’s annual meeting each fall. But prior to these remarks and last year’s monetary distribution to players, the union in 2016 built up its asset base to $178.6 million, the second-largest sum in the organization’s history. If Clark’s remarks prove true, it is possible that MLBPA’s assets will grow beyond $200 million, which has happened just once before, in 2011.

The union’s revenue from “other receipts,” where licensing income is listed and itemized, was reported at $54.2 million for last year, up 6 percent from 2016. The annual report, known as the LM-2, is based on cash and not accrual accounting, and payments are credited in the years they are received and not earned. As a result, views into the financial state of the organization can be deceiving.

Still, the MLBPA continued to show growth in revenue from several of its top licensees, a situation Clark credited to increased fan interest in baseball and better visibility of players’ personalities.

Trading card partner Topps was the union’s largest licensee last year with $11.2 million in payments, up from $10.9 million, though some of that latest figure represented obligations from 2016. Sony Interactive Entertainment, makers of the video game “MLB: The Show,” ranked second at $9.8 million, up from $6.7 million the prior year.

Clark earned $2.21 million in total compensation in 2017, up 5.7 percent from the prior year.