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Anatomy of an MLB Salary Arbitration Hearing PDF Print E-mail
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Written by Maury Brown   
Wednesday, 03 February 2010 12:47
Tim Lincecum
Tim Lincecum seems headed for a record
salary via arbitration. All signs point to
he and the Giants going to hearing

It should come as no surprise, but all signs are pointing to Giants starting pitcher, and back-to-back Cy Young winner Tim Lincecum going to salary arbitration hearing. The case, one that will set a precedent for future years, sees the Giants offering $8 million (a record offering figure for a first time salary arb player) while Lincecum is seeking $13 million. The mid-point between the two is $10.5 million, which on the face of it seems low given that Ryan Howard won his record salary arbitration case in 2008 and was awarded his $10 million asking figure. Howard had won an NL MVP, which begs the question, how much is two Cy Youngs worth? To some, $500,000 might not be enough.

Of course, there’s the logic that Lincecum, and his agent Rick Thurman of the Beverly Hills Sports Council never planned on meeting at the middle to begin with. That in placing a $13 million asking figure, the changes are good that Lincecum could win his case, thus setting the bar three times: he’ll smash Howard’s first time arb record, make more than double what a first time salary arb pitcher has made through the process (Jonathan Papelbon’s $6.2 million settlement last year), and would set a record for the most salary awarded through the hearing process.

But, how does the hearing process work? Here’s the details.

First off, when you were sleeping, the window for hearings has already begun. Starting on Feb. 1 and running through to the 21st, hearings have been scheduled. As of the morning of the 3rd, there are 17 players out of 44 that exchanged figures that are left in the process. By comparison, at this same point last year there were still 29 out of 46 players that had yet to reach contracts or go to hearing, a sign that agents, players, and clubs are getting work done earlier this year than last.

As for the hearings themselves, there’s considerable jockeying between management and the union for getting hearing dates set. The later into the process, the more deals that have been brokered, and therefore, more salary figures to compare to. With Lincecum’s case, the plum of this year’s salary arbitration crop, he is most surely scheduled well toward the end of the window, possibly the 18-19th. To try and keep the decision from other hearings from influencing the outcome of others, like positions have hearings on the same day. A leaked hearing date of Feb. 17 for the Astros Wandy Rodriguez is known, so it’s possible Edwin Jackson, Jeremy Guthrie, or Justin Verlander could have hearings on the same day, should they not have reached a settlement deal beforehand.

Here’s the cadence for the hearing, once it begins (see details on what is, and is not admissible during the hearing process):

  • The club and player representatives exchange their “exhibits”, usually in binder form. This allows each side to prepare for any rebuttals in the process. While players often attend salary arbitration hearings, it is not mandatory.
  • The hearings start with a one-hour argument for the player making the case for the asking figure they are seeking.
  • After arguments for the player, management then has an hour to make their case for their offering figure.
  • The one-hour arguments are then followed by 30 min. rebuttals for each side (player goes first, then club).
  • The panel of three arbitrators then rule, normally within 48 hours, as to which salary figure (player, or club) that the player will earn during the upcoming season. There is no middle ground.

So, when will the action start? Using last year as a barometer, SP Shawn Hill and the Washington Nationals had the first hearing in 2009 on Feb. 7. Hill won his case, and therefore was awarded his asking figure of $775,000 compared to the Nationals $500,000 figure. But, keep in mind, players and management can work to reach deals right up until a hearing starts. More than one deal has been reached just outside the hearing room on the day of a case.

As a point of reference, here is how the 29 contracts from Feb. 3-20 fell on the calendar, last year.

Salary Arb by Date

 

Date

Contracts

2/3/2009

3

2/4/2009

1

2/5/2009

2

2/6/2009

1

2/7/2009

3

2/8/2009

3

2/10/2009

1

2/12/2009

2

2/14/2009

1

2/16/2009

1

2/17/2009

6

2/18/2009

3

2/19/2009

1

2/20/2009

1

 

SUPPORTING DATA:


Maury BrownMaury 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 available for hire or freelance. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network.

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