visa credit card insurance on purchases credit building credit cards with no deposit chase credit card rewards center bpi credit card cash advance pin easy credit card to get approved for 2012 best buy credit card customer service ics international credit card services visa credit card application for bad credit guarantor loans online uk which credit card is best for international travel personal loans ireland bad credit hsbc uk lost credit cards hsbc debit visa card issue number balance transfer offers halifax existing customers credit card holder leather best 0 interest balance transfer credit cards credit card debt settlement australia prepaid credit cards with overdraft best uk credit card for airmiles chase bank pre approved credit card icici credit card insurance benefits i want a credit card that has no limit get online loan how to reduce your credit card debt yourself credit card low interest balance transfer chase international travel credit card sears canada credit card contact number unsecured credit cards for bad credit canada average credit card merchant fees what does a black credit card mean compare and contrast the good and bad characteristics of credit cards credit cards with no interest and no balance transfer fees pay shell gas credit cards online virgin credit card uk login anz credit card travel insurance claim national cash advance head office debit visa card canada citibank international credit card india prepaid credit cards no activation fee cash reward credit card comparison military credit card rate reduction united cash loans login page anonymous prepaid credit card australia how to get the best merchant credit card rates online cash loans for bad credit direct payday lenders bad credit ok whats a good first credit card walmart credit cards online application citibank platinum credit card features speedy cash payday loans reviews credit card instant approval india business credit card balance transfer 0 pay as you go credit card processing buy visa gift card online instant apply for gold credit card fnb westpac low rate credit card interest rate how to download free apps for ipad 2 without credit card pay target visa credit card online how do i pay my firestone credit card online get a payday loan online instant payday lenders no brokers compare canadian credit cards cash back who has the best credit card rate home depot credit card promotions hdfc credit card helpline no gurgaon visa debit cards wikipedia how does a cibc visa debit card work online standard chartered credit card payment india sbi online credit card rewards hsbc corporate credit card malaysia using us credit cards in canada bad credit credit cards no annual fee credit card number location student credit cards with no credit instant approval what credit score do you need for a toys r us credit card no interest credit card transfer offers td rebate rewards visa card limit visa credit card with low interest rate can you buy prepaid credit cards at walmart in canada mbna canada credit card payments hsbc balance transfer credit card list of credit card company names is personal credit card interest tax deductible need for speed carbon reward cards ps3 prepaid credit card visa bank of america manchester united credit card review cibc visa cash back credit card what is purchase interest rate in credit card chase business credit card phone number wells fargo credit card services apply online credit card citibank post office credit card balance transfers southwest credit card offers two free flights using credit cards abroad compare sbi and icici credit card best credit card payment app not so good credit cards credit card search engine india horizon gold credit card complaints nationwide online loan quote get credit card information free best bad credit credit cards unsecured swarovski hello kitty credit card holder call chase freedom credit card customer service credit card for new business bad credit city bank credit card application malaysia how to sign up for amazon prime without credit card free prepaid credit cards canada free gnc gold card interest free credit card tesco canada best credit card points best online credit card processing 2012 business card credit analyst salary walmart credit card canada phone number best credit cards for travel perks bad credit loan lenders uk simmons first credit card application status business credit card offers balance transfer icici credit card helpline mumbai best payday loan lender uk chase credit card apr citibank credit card apply compare credit cards for bad credit best student credit cards with no credit nab credit cards travel insurance credit card for no credit score tips on how to get rid of credit card debt college student no credit credit card how can i pay icici credit card bill online apply online credit card icici bank payday loans for bad credit instant cash top ten credit cards 2013 lowest rate mobile credit card processing orchard credit card payments online 0 credit card offers balance transfers which is the best student credit card in canada best travel points credit card canada 2011 visa prepaid credit card online anz rewards platinum credit card travel insurance bank of america power rewards visa card virgin credit card mbna contact number what does a starbucks gold card do best cash back business credit cards 2013 air miles credit card comparison disney chase credit card rewards balance transfers explained major credit cards how do you calculate interest payments on a credit card example nandos black card td canada trust secured visa cards difference between visa and mastercard debit card capital one credit card review canada how do i check the status of my best buy credit card application hsbc premier credit card air miles army pcs pay advance credit card number and security code and expiration date payday loan lender list uk top bad credit loan companies best buy credit card customer service contact get credit card for bad credit rating how to pay bank of america credit card online with another bank account credit cards for new uk residents credit card ratings consumer reports td visa card account login delta miles credit card deals secured credit card 10000 limit bank of america sign up for credit card bank of america credit card login mastercard aadvantage credit card offer 2013 hsbc credit card promotions for hotels pay my bestbuy credit card hdfc credit cards rewards points redemption apply for mastercard credit card with bad credit secured credit cards for business wells fargo check chase freedom credit card application status secured credit card banks online loans in south africa no paperwork what does it mean to get pre approved for a credit card best cash back visa or mastercard low rate credit cards for life of balance transfer delta credit card cash back malaysia credit card review 2013 credit card fraud sentence in florida best credit card transfer rate nz aspire credit card company does applying for credit cards hurt my credit score view hdfc credit card statement online delta skymiles credit card good deal does walmart credit card help build credit accept credit cards with no credit check new bad credit card offers standard chartered credit card promotions singapore credit card terminal application how long can credit card companies sue you how to get past the halo reach credit limit bank of america virtual credit card debit apply for capital one credit card application chase credit card travel protection credit cards that offer cash back rewards credit card uk comparison credit card number and cvv validator download orange prepaid credit card paypal credit card verification code fake bankamericard cash rewards visa secured credit card how to get a bad credit mortgage fnb gold credit card interest rates gift visa card india vacation pay advance form 0 interest credit card balance transfer ireland chase credit card balance transfer calculator citibank indian oil credit card reward points redeem pay off credit card debt or save for college hsbc bank credit card customer care number how can i get a best buy credit card with no credit platinum card post office storing credit card information law uk bank of america prepaid debit visa card calculate credit card interest rate payment fast payday advance loans credit card cash advance atm limit best visa debit card for students find the best credit card for me canada reducing credit card debt online payday advance california cash advance america payday loan scams discover credit card review 2012 credit card comparisons nz hsbc credit card rate of interest best unsecured credit cards with bad credit secured visa credit cards alaska air miles credit card td emerald visa card application how to get a rbc visa debit card chase freedom credit card review 2011 can i get a credit card without a job and bad credit airline credit card with no annual fee credit card offers 0 balance transfer 12 months credit card for small business with no credit credit card application form pdf low rate credit card australia sbi credit card offers on samsung mobiles icici credit card payment using debit card best rate credit cards 2013 is it safe to apply for a chase credit card online alaska air miles credit card reviews how does credit card interest work malaysia best new credit card bonus offers chase credit cards online payment arco gas credit card fee does paypal accept virtual credit cards hdfc credit card toll free number chandigarh ikea usa credit card apply black visa card uk important things to know before getting a credit card streamline credit card machine rolls best credit card for first time users with no credit credit card company list halifax credit card minimum payment amount secured mastercard credit card canada store rewards cards in phone starbucks credit card processor 0 intro apr for 12 months credit cards credit card validator free download secured credit card canada compare virgin credit card balance transfer limit store photos of credit cards on iphone net pay advance wichita get a payday loan online direct lender how can we pay lic premium using credit cards valid credit card numbers that work 2012 where to send old navy credit card payments credit card holder with money clip can i buy a visa gift card with a walmart credit card pnc secured credit card login bank of america international travel credit card how to get a bad credit loan without a bank account can i get a credit increase on a capital one secured card store credit cards after bankruptcy what credit card can i get with a score of 620 disney chase credit card application status how to pay canada student loans legitimate poor credit loans how to receive pre approved credit card offers how to hack a credit card number visa 2011 prepaid reloadable credit cards walmart all credit cards into one public savings open sky secured visa credit card amazon bank of america credit card how old do you have to be to get a prepaid credit card in canada australia;s lowest rate credit card credit card low interest rate small cash loans uk file bankruptcy credit cards only credit card number and security code hack compare credit card rewards australia payday quick cash loans online payday lenders california average credit card apr 2012 chase freedom credit limit increase online iphone credit card case 4s hdfc credit card application status disapproved valid credit card numbers generator with cvv credit cards for bad credit 2013 uk citibank platinum credit cards capital 1 credit card ppi claims best credit cards with rewards consumer report whats the highest credit card limit sears credit card services address reclaim credit card protection insurance charges credit card calculator multiple interest rates navy federal credit union student credit cards best 0 balance transfer credit cards uk applying for credit cards with poor credit first modern credit card introduced 1950s capital one canada credit card agreement no fee td visa cards low limit credit cards for students credit limit definition wikipedia credit card debt settlement agreement best delta credit card deal merchant fees for credit cards comparison canada cibc debit visa cards first premier credit cards pay new york and company credit card online what is the best credit card to have with bad credit easiest way to get a credit card uk one hour cash advance lenders online lowest apr credit card rates 0 interest credit cards no balance transfer credit card prime rate definition continental chase mastercard credit card apply for ikea credit card uk standard chartered online credit card payment pay as you go credit cards canada free credit cards numbers that work 2011 suze orman best secured credit card best travel credit card deals 2011 mastercard credit cards for no credit history best credit card transfer balance no transfer fee car loan with bad credit random credit card number and cvv calculate credit card balance transfer calculator reloadable prepaid credit card with no fees online payday loan lender only best small business credit card 2012 canada low interest credit cards for average credit hdfc credit card apply online in bangalore prepaid credit card to help rebuild credit visa credit card application no credit transfer credit card balance to low interest loan compare visa credit cards australia apply for visa credit card with fair credit accepting credit cards over the phone with paypal bad credit loan lenders credit card address verification phone number pay dillards credit card account online sheer black cardigan women;s bank of america credit card application status phone number orchard bank unsecured credit card reviews platinum card american express limit virtual credit card paypal free jcb credit card number format no interest credit cards bad credit best money back credit cards 2011 cash advance online no credit check legit bad credit loan lenders american express prepaid credit card reviews credit card rewards canada dbs black card travel insurance dbs black card credit limit capital one best buy credit card customer service number compare air miles credit cards canada integrity advance payday loans no credit card business loans speedy cash payday loans online payday cash advance direct lenders only calculate credit card interest rate calculator credit card debt consolidation ontario canada best credit cards for students with no annual fee low interest easy approval credit cards citi corporate credit card payment best credit card reward scheme best buy credit card payments center international credit cards for students major credit cards companies starbucks credit card discount icici credit card application status using application number are orchard bank credit cards good how old do u have to be to get a credit card in the uk does arco gas station accept credit cards rbc visa prepaid credit card hdfc credit cards payment online top credit card issuers in malaysia wells fargo secured credit card business is capital one a good credit card after bankruptcy how does cash converters payday advance work list of bad credit loan lenders new fees for credit cards 2013 top 5 credit card processing companies 100 guaranteed credit card approval uk apply for discovery credit card how long does it take to get a secured credit card bank of america pre approved credit cards canada wells fargo secured credit card cash advance fee square credit card reviews data mining implementation for credit cards application processing system phone number for orchard bank credit cards small cash loans with bad credit how to get credit card numbers hacked black credit card visa limits top 10 college student credit cards nhs discounts black card best corporate credit card canada real usa credit card number compare travel credit cards 2013 capital one platinum credit card reviews merchant credit card fees visa sbi visa classic debit card take credit card payments on android disney rewards credit card phone number high interest credit cards for bad credit canada credit card number checker free download capital one small business credit card agreement tesco credit card protection apply for a mastercard credit card online american express prepaid credit card uk international credit card processing first credit card company in 1950 credit check companies virgin credit card payment what is the best credit card to use in america does kmart accept sears credit cards send money online using your credit card best secured credit card bad credit do prepaid credit cards help rebuild credit title loans online no credit check best low interest credit cards for students how to get credit card limit increase chase easy approval gas credit cards offers on visa cards india cvv number on visa debit card can you use us credit card in uk costco credit card processing rates for small business rbs visa credit card uk bad credit loans no credit check unsecured get credit card numbers download best credit card to get american airline miles sears credit card application status phone number how do i get a cash advance on my capital one credit card compare rewards credit cards orchard bank bad credit credit card low interest credit cards canada visa best secured visa credit cards emirates platinum card discounts credit card reward tricks td canada trust cash back credit card rbc credit card travel notification hsbc credit card application pinoyexchange valid stolen credit card numbers how to open up a locked door with a credit card unsecured credit card for bad credit instant approval best fixed rate credit cards 2011 capitec multi loan online application credit expert best credit card offers for new users lloyds tsb student credit card interest rate is there a starbucks credit card visa card number sample easy credit card approval australia credit card swipe app for windows phone best citibank credit card offer iphone credit card payment hdfc credit card deals on flights credit card debt after death california best credit card for no credit or bad credit how many types of credit cards are there orchard bank secured credit card phone number pentagon federal credit union credit cards apply for first premier credit card sbi credit card customer care number mumbai apply for a walmart credit card online instant cash loans in minutes microsoft excel credit card payment calculator industry average credit card processing fees prepaid credit card help build credit best cashback credit card comparison cash advance credit card chase icici bank international credit card using visa debit cards in india hotel reward credit cards comparison icici bank credit card settlement letter apply for a loan with bad credit and no bank account capital one visa platinum card speedy cash loans oldham allied cash advance westfield in credit cards compare uk british airways credit card offer uk titanium visa prepaid credit card virtual credit card number uk track barclay credit card application
Home All Articles By the Numbers: A Breakdown of the '08 Salary Arbitration

Like Shoot to Thrill - An AC/DC Tribute on Facebook!

An authentic tribute of AC/DC that covers the best of the Bon Scott era and the best of Brian Johnson's material

Who's Online?

We have 610 guests online

Atom RSS

By the Numbers: A Breakdown of the '08 Salary Arbitration PDF Print E-mail
User Rating: / 4
PoorBest 
Articles & Opinion
Written by Maury Brown   
Monday, 25 February 2008 22:00

A Biz of Baseball ExclusiveA Look Inside Salary Arbitration. Who Won. Who Lost. And, How Players Nearly Always Come Out Ahead

Most would say 1974 or 1975 was the most important for the players.

’74 represents the year that Jim “Catfish” Hunter was declared a free agent after Charlie Finley was found to be in breach of contract after not deferring part of Hunter’s salary and placing it in an annuity. The ensuing bidding war for Hunter showed just how much money owners were willing to throw at a free agent, if the shackles of the reserve system were thrown off.

’75 represents the year that Andy Messersmith and Dave McNally played their part in the historic Peter Seitz ruling in which the reserve clause was removed from baseball, and free agency became what is now, a permanent part of Major League Baseball.

Both are key points in history. Both are defined by Marvin Miller, Dick Moss and the Players’ Association. Both are watershed moments that redefined the rights of players, and by extension, the amount of money in salaries they would make. But, it is really 1973 that is Miller’s defining moment.

In 1973 salary arbitration was implemented in MLB, and since then has been a boon to the players, a thorn in the side of general managers, and a drain on owners’ wallets.

The system works thusly:

A player of over 2 years of service time (the CBA defines one full year as a total of 172 days of Major League credited service) can file for salary arbitration (see a listing of those that filed for salary arbitration this year), and at a given date on the calendar (this year it was January 18), if the parties have not yet reached a deal, the club and player exchange salary figures for what they wish to pay, or be paid, for the following year (see all the figures exchanged for 2008). If a deal is not reached by the club and player, then both sides present their case at a hearing before a panel of three arbitrators, which then rules whether the player figure or the club figure will be paid to the player over the next season. There is no in-between. It is either one, or the other.

Against that backdrop, more and more, deals are struck before hearings take place. In either case, the clubs almost always come out on the bad side of the deals.

Each year, I go through and examine all players that exchanged figures with the respective clubs and see who won, who lost, and when you think about it, who really lost while winning. Here are some details around the 2008 salary arbitration class:

Select Read More to see a Breakdown of this Year's Salary Arbitration Class

Salary Arbitration Details2008 Salary Arbitration Facts and Figures

Here’s some raw figures regarding the arbitration class of 2008. The figures are based on my analysis of the 48 players that exchanged figures with their clubs, with some additional data through The Associated Press.

(select the image to the left to see details for the 48 players that exchanged figures):

  • Increase in Salaries for the 110 players that Filed for Arbitration from Last Season: 120 percent.
  • Average Salary Increase for all 110 Players that Filed for Arbitration: An increase from $1.38 million to $3.04 million, was up from 106 percent last year and the highest since a 123 percent rise in 2005. The average rose from $3.01 million last year but was below the record $3.26 million set in 2004.
  • Multi-year Contracts for the 110 players that Filed for Arbitration: Sixteen players received multiyear contracts, two more than last year and the most since 17 in 2002.
  • Multi-year contracts for the 48 players the Exchanged Figures: Out of the sixteen total players that got multi-year contracts, ten of them were part of the pool that exchanged figures (Betancourt, Cano, Chavez, Cuddyer, Greene, Molina, Phillips, Rauch, Sanchez, Soriano)
  • Increase in salaries for the 48 players that filed for arbitration from last season: 220 percent.
  • Total salaries paid out to the 48 players that exchanged figures: $136,075,000
  • Average salary of the 48 players that exchanged figures for 2008: $2,834,896 , down from $2,853,214 last season.
  • Number of players that went hearing with their clubs: 8 (Clubs winning 6)
  • Historical Scorecard (From 1974, current to 2008): 485 hearings with owners winning 280 compared to players winning 205 case, or 57.73 percent of hearings in favor of owners.
  • Largest salary increases from last year (base salary):

Ryan Howard whose 2007 salary was $900,000, but sees it skyrocket to $10,000,000 by his winning salary arbitration hearing with the Phillies, an increase of 1,011 percent from last season. Howard is followed by Garrett Atkins (2007 salary: $400,000, 2008 salary $4,387,500, or an increase of 997 percent), and Brad Hawpe of the Rockies (2007 salary: $403,000, 2008 salary $3,925,000, or an increase of 874 percent) Chien-Ming Wang of the Yankees (2007 salary: $489,500, 2008 salary $4,000,000, or an increase of 717 percent by way of Yankees winning salary arbitration hearing), and Kevin Youkilis of the Red Sox (2007 salary: $424,500, 2008 salary $3,000,000, or an increase of 607 percent)

  • Largest increase of a multi-year deal based on average salary:

Brandon Phillips, whose salary went up 1,556 percent, from $407,500 to an average of $6.75 million under his $27 million, four-year contract. Followed by Robinson Cano, whose salary rose 1,428 percent, from $490,800 to an average of $7.5 million in his $30 million, four-year deal.

For the 48 players that exchanged figures, total amount of salary by position (base salary), along with player that had highest salary for that position:

  • SP (8 players): $26,780,000 (Highest: Erik Bedard at $7,000,000)
  • RP (19 players): $40,272,500 (Highest: Francisco Rodriguez at $10,000,000)
  • 1B (2 players): $13,000,000 (Highest: Ryan Howard at $10,000,000)
  • 2B (5 players): $13,500,000 (Highest: Robinson Cano at $3,000,000)
  • 3B (2 players): $10,487,500 (Highest: Casey Blake at $6,100,000)
  • C (2 players): $3,987,500 (Highest: Josh Bard at $2,237,500)
  • OF (6 players): $16,397,500 (Highest: Michael Cuddyer at $5,000,000)
  • SS (4 players): $11,850,000 (Highest: Felipe Lopez at $4,900,000)

For the 48 players that exchanged figures, total amount of salary by service time (base salary):

  • Under 3 years (6 players): $22,062,500 (Highest: Ryan Howard at $10,000,000)
  • 3-4 years (22 players): $37,815,000 (Highest: Garrett Atkins at $4,387,500)
  • 4-5 years (9 players): $31,322,500 (Highest: Erik Bedard at $7,000,000)
  • 5-6 years (9 players): $40,675,000 (Highest: Francisco Rodriguez at $10,000,000)
  • Above 6 years (1 player): $2,750,000 (Mark Loretta, 12.011 of service time)

The 48 players that exchanged figures, by club:

  • Atlanta (1): Soriano
  • Baltimore (1): Cabrera 
  • Boston (2): Snyder, Youkilis
  • Chicago Cubs (1): Wuertz
  • Cincinnati (2): Belisle, Phillips
  • Cleveland (2): Betancourt, Blake
  • Colorado (3): Atkins, Fuentes, Hawpe
  • Houston (4): Borkowski, Geary, Loretta, Valverde
  • Kansas City (3): German, Greinke, Teahen
  • Los Angeles Dodgers (2): Beimel, Proctor
  • Los Angeles Angels (1): Rodriguez
  • Milwaukee (2): Bush, Hardy
  • Minnesota (2): Cuddyer, Guerrier
  • New York Mets (5): Chavez, Church, Feliciano, Perez, Sosa
  • New York Yankees (3): Bruney, Cano, Wang
  • Oakland (1): Gaudin
  • Philadelphia (2): Bruntlett, Howard
  • Pittsburgh (1): Sanchez
  • San Diego (2): Bard, Greene
  • San Francisco (2): Chulk, Correia 
  • Seattle (1): Bedard
  • St. Louis (2): Molina, Wellemeyer
  • Toronto (1): Rios
  • Washington (2): Lopez, Rauch 

“What’s to like about it?”

To place the arbitration process in perspective, there is a reason that so few clubs and players go all the way to hearing. The stakes are too high. That and the clubs really lose even when they win. Whether a deal is struck before hearing, or if a club wins at hearing, the player nearly always gets a hefty raise.

Case in point, of the 48 players that exchanged figures, all of them but two sees raises this coming season when looking at just base salary. The exceptions are SS Mark Loretta, who lost his salary arbitration hearing with the Astros, and Alex Rios, who signed a one year deal with the Blue Jays. In Loretta’s case, there are no other figures that go with. He lost the case, and gets the salary. In Rios’ case, his base salary might be lower than he made last season, but he gets a $3.5 million signing bonus to go along with his salary of $1,335,000, and he would make an additional $15,000 if he is selected for the All-Star game. So, Rios is guaranteed $4,835,000 this year, an increase of $2,300,000 from last season.

So, it’s understandable that general managers aren’t exactly keen on the process. Asked to comment off the record, here’s what some had to say.

“It’s a way of life, but that doesn’t mean I have to like it,” said one “The player wins, even if we win. And even then, the process of hearings can build tension between us and the player.” Maybe, this reply said it all: “Honestly? What’s to like about it?”

So, is it any wonder that the parties work to get a deal done in advance of going to hearing? At least then they might be able to save a smidgen of the owner’s money.

The Mid-Point

Comparing the offer figure by the club and the requested figure by the player, we can derive the mid-point in-between what the club thinks the player is worth, and what the player and agent think he is worth. Of the 48 players that exchanged figures with their clubs, five of them reached base-salary deals for 2008 at this mid-point:

  • Garrett Atkins (Rockies): $4,387,500
  • Erik Bedard (Mariners after trade from Orioles): $7,000,000
  • Joe Beimel (Dodgers): $1,925,000
  • Kevin Correia (Giants): $1,075,000
  • Matt Guerrier (Twins): $950,000

As mentioned, the vast majority of players will receive a salary below the mid-point in-between the offered and requested salaries. Some, however, will receive salaries above the mid-point. Those seven players are:

  • Josh Bard (Padres): $2,237,500, or $62,500 (2.79 percent) above the mid-point ($2,175,000)  
  • Eric Bruntlett (Phillies): $800,000, or $125,000 (15.63 percent) above the mid-point ($675,000)
  • Geoff Geary (Astros): $1,125,000 or $25,000 (2.22 percent) above the mid-point ($1,100,000)
  • Khalil Green (Padres): $4,500,000 or $50,000 (1.11 percent) above the mid-point ($4,450,000)
  • Ryan Howard (Phillies): $10,000,000 or $1,500,000 (15 percent) above the mid-point ($8,500,000). Note: Howard won his salary arbitration hearing with the Phillies.
  • Oliver Perez (Mets): $6,500,000 or $887,500 (13.65 percent) above the mid-point ($5,612,500). Note: Perez won his salary arbitration hearing with the Mets.
  • Scott Proctor (Dodgers): $1,150,000 or $35,000 (3.04 percent) above the mid-point ($1,115,000).

The rest of the players that exchanged figures (35), reached deals that were below the mid-point, which explains why clubs work to reach the deals in advance of hearing, knowing that they could lose their case.

The following is a listing of players that had the largest decrease in salary when compared to the mid-point (base salary, no bonuses included):

  • Alex Rios (Blue Jays): $3,757,500 below the mid-point ($5,092,500) or -73.78 percent.
  • J.J. Hardy (Brewers): $1,075,000 below the mid-point ($2,725,000) or -39.45 percent.
  • Mark Loretta (Astros): $1,075,000 below the mid-point ($3,825,000) or -28.10 percent.
  • Yadier Molina (Cardinals): $550,000 below the mid-point ($2,300,000) or -23.91 percent.

Remember, Molina reached a 4-year deal that will see him earning an average salary of $3,625,000 over the life of his contract with the Cardinals, so the decline in salary this year will be made up in subsequent years ($3.25M in 2009, $4.24M in 2010, and $5.25M in 2010).

As for Loretta, his decrease is based in losing in salary arbitration.

What Can We Learn From the Hearings?

 This year will most likely be remembered for the Ryan Howard ruling. Howard beat the Phillies in arbitration, which was a feat unto itself. Consider, the following:

  • The Phillies had been 7-0 in salary arbitration up to the Howard case (Jerry Koosman, Alan Knicely, Kevin Gross, Dickie Thon, Dale Sveum, Willie Banks and Travis Lee). The last case the Phillies won was 2001 with Travis Lee.
  • Tal Smith, who has represented nearly every club in his long tenure as a representative for management, was representing the Phillies.
  • The gap between offering figure ($7,000,000) and requesting figure ($10,000,000) was the largest gap between the sides for the 2008 class that exchanged figures.
  • Howard’s requesting figure was the highest ever for a player with his level of service time, under 3 years (2.145).

With Howard’s win, he becomes the player with the highest winning award figure since Andruw Jones won his case with the Braves in 2001 ($8,200,000) and ties for the all-time award with Alfonso Soriano who lost his case with the Nationals in 2006 (he had requested $12,000,000). In winning, he sets the bar exceptionally high for young players (under 3 years of ST), or Super Twos.

Other factoids:

  • There were 8 hearings this year, with the owners winning 6-2. The last time there was that many players that went to hearing was 2001 when 14 players had their cases heard.
  • While Howard’s gap between offering and requesting figures seems high ($3 million), it isn’t the largest. The $4,475,000 gap between the Cubs offering figure ($11,025,000) and Carlos Zambrano requested figure ($15,500,000) last year is the largest gap ever. 

Conclusions

The owners have beaten the players in salary arbitration for 12 consecutive years, but players still enjoy incredible salary increases through the arbitration process. The last time the players won was in 1996 when Steve Avery (Braves), Jeff Fassero (Expos), Chuck Knoblauch (Twins), Mark Lewis (Tigers), Mike Stanton (Red Sox), Rick Wilkins (Astros), and Bernie Williams (Yankees) took 7 of the 10 cases heard. With Ryan Howard winning his hearing this year, he sets the table for other young players that enter salary arbitration, raising the bar exceptionally high.

Clubs are wrapping up players earlier and earlier, in many instances through the some of their free agency years. The best example of this was the unprecedented deal the Rockies gave to shortstop Troy Tulowitzki, a six-year, $31 million contract. It was the largest contract awarded to a player with under 2 years of service time (1.033). Dan O’Dowd and the Monforts clearly see the investment in the players that got them into the World Series last season as cornerstones to build off of. But, the question is, did his deal set a bad precedent? As one high-ranking executive said, “Tulowitzki appears to be special and his signing to a multi-year contract at this stage may very well work out to be of benefit to the Rockies.  But, frankly I would have waited. He wasn't even arbitration eligible until 2010.”

The landscape with free agency and arbitration has altered the face of Major League Baseball forever since they were instituted in the early ‘70s. But, as I have outlined, it is clearly salary arbitration that increases the size of the players’ wallets more than free agency. In that, salary arbitration should be seen as Marvin Miller’s pride and joy.

Select the image above to see details of the 48 players that exchanged figures with their clubs, agents (where they could be found) along with contract information. Please contact Maury Brown to fill in gaps in the agent register

Media and clubs can contact Maury Brown for an even further detailed accounting of these players, as well.

Sources: The Biz of Baseball's historical arbitration research, The AP, Jayson Stark


Maury Brown

Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He is also a contributor to Baseball Prospectus, and is available as a freelance writer.

Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network

 
 
Banner

Poll

Should MLB Force Jeffery Loria to Sell the Marlins?