MLB players look to defend free labor market as owners push for a salary cap

For the first time in the history of the Milwaukee Brewers, the team’s players will be enjoying the baseball offseason as champions after winning the World Series last week.

How long this offseason will last, though, is anybody’s guess. The league’s collective bargaining agreement with players expires Dec. 1, and team owners are widely expected to lock the players out.

Owners want a salary cap. Every major team sport in the U.S except baseball puts a limit on how much a team can spend on its payroll. The idea is to prevent any one team from loading up on all of the top talent and skewing the competitive balance of the league.

The MLB players’ union does not want a salary cap. So a lockout seems inevitable, and could drag on into next season. At stake for the players is the ability to tap into a free market for their services after years of paying their dues.

Being a baseball player at the beginning of your major league career is very different from being an established player: There’s nothing free about the labor market when you’re a rookie.

Mike Trombley knows this firsthand. He pitched for three major league teams from 1992 to 2002.

“The very first few years in my career were horribly stressful,” he said. “I didn't know if I was going home tomorrow. I never had a guarantee of anything.”

That’s because in their first six years in the majors, baseball players are entirely under their team’s control. So in his early years, Trombley earned just above the league’s minimum salary pitching for the Minnesota Twins: Roughly $240,000 in today’s dollars. Despite his fairly comfortable pay, it was a precarious existence.

“I remember in 1994, ‘95, [it] felt like every game, this could be my last game,” he said. “Because, hey, they send me to AAA or ship me out or release me, I'm gone.”

But he never got stuck in the minors, and after the 1999 season he became a free agent.

That meant any of the 30 MLB teams could offer him a contract. The Baltimore Orioles did for three years, and a salary that would total around $15 million today.

“When you're signing that three-year deal as a free agent, it's relaxation, it's making more money for your family,” Trombley said.

And, free agency is the chance to test your value in an open market, said David Berri, an economics professor at Southern Utah University. For a select few players, that value is enormous.

“So you have potentially every team bidding for your services, and they will bid the price up for the stars to a point where they can get paid $30, $40 million a year to play baseball,” Berri said.

Major League Baseball argues that’s a problem. A team in a larger media market, with more revenue, can fork over more money for star players, gaining a competitive advantage over teams with less money.

So, MLB is proposing to regulate that free market, by establishing a maximum and minimum amount teams could spend on their payroll.

“We would implement a floor,” said Morgan Sword, MLB’s executive vice president of baseball operations. “Right now, about 12 clubs are below that floor that we're proposing, so they would have to increase their payrolls, and a cap, which would force the clubs with the very highest payrolls to reduce their payrolls, you’d have to be under the cap.”

Sword and the league argue those changes would increase the overall amount players make. Because some teams would need to spend more, players in the sport’s middle class, like Trombley was, might make a bit more in the free agent market. Superstars would make less.

The players’ union did not agree to an interview by Marketplace’s deadline. But in a statement earlier this year, it said the league’s proposal “ensures gains for one player only come at the expense of another.”

Owners have proposed a salary cap before, and baseball’s union has stuck together in opposition. One reason for that, said David Berri at Southern Utah University, is because some players unexpectedly become superstars.

Take former designated hitter David Ortiz, for example. At 28 years old, eight years into his Major League career, he hit a walk off home run in the 2004 American League Championship series, leading the Boston Red Sox on an improbable run to their first World Series win in 86 years.

Just two years earlier? “His career didn't look like it was going anywhere. He goes to the Red Sox and becomes a Hall of Famer. That's insane,” Berri said.

Ortiz went on to make as much as $16 million a year. Other baseball players want to believe that could be them.

The thinking on the players’ part is, “I'm not going to vote for a salary cap that's going to take away my potential payday,” Berri said.

If the players hold out in defense of the current system long enough, the league might have to cancel some or all of next season. It’s happened before. Back in 1994 and ‘95, the players went on strike, in part, over a proposed salary cap.

Former pitcher Mike Trombley was early in his career then. He could have crossed the picket line as a replacement player.

“So, I was 26 years old, something like that, and I had a wife and just had a kid, and I needed the money,” he said. “It would have been easy to grab that quick check.”

But, he didn’t. The union stuck together. MLB did not adopt a salary cap. And, a couple years later, Trombley got his payday on the free market.