The Myth of Six Years of Team Control

Last week, Ken Rosenthal reported — and others have since confirmed — that the Astros offered top prospect George Springer a seven year, $23 million contract. He turned them down, and has since been optioned to Triple-A, where he will begin the season. Presumably, had he accepted the contract offer, he may very well have been named the Astros Opening Day right fielder, as the contract would have nullified the benefits of keeping him from accruing a full year of service time in 2014, and it’s not like the Astros have a better right fielder blocking his path at the moment. However, since Springer did not accept the contract, he’ll have to wait at least a few weeks to join the Astros, and potentially a few months if they decide to try and get him past the Super Two cutoff as well.

On the one hand, it’s easy to paint this as a picture of an organization acting in bad faith, using the carrot of a big league roster spot to try and coerce a young player into signing away his future earnings potential. The MLBPA is even considering filing a grievance on Springer’s behalf — even though he isn’t a member yet, since he is not on the Astros 40 man roster — over the issue, though it would be nearly impossible for them to prove intent given that Springer only has 266 plate appearances in Triple-A; optioning out a young player with Springer’s contact rate would be pretty easily defensible on merit alone. But the perception of impropriety still exists, due to the appearance that his demotion was directly tied to his decision to reject the Astros contract offer, whether that is actually true or not.

The Springer news has brought about another round of calls for reformation of the rules in order to remove the incentives for teams to keep their best young players in the minor leagues to begin the season, and I’m with the crowd who thinks that MLB is best served by allowing teams to make roster decisions based on talent and performance rather than worrying about accrued service time. I’d rather see George Springer play in April than whoever the Astros end up rolling out there on Opening Day. But for MLB and the MLBPA to come to any sort of consensus on this in the next CBA negotiations, everyone will first have to admit that the concept of six years of team control is basically a myth.

The opening paragraph of the CBA’s section on Free Agency — Article XX, Section B — states the following:

Following the completion of the term of his Uniform Player’s Contract, any Player with 6 or more years of Major League service who has not executed a contract for the next succeeding season shall become a free agent, subject to and in accordance with the provisions of this Section B.

Six or more years. The CBA does not say that a player is entitled to free agency after six years in the big leagues; it sets six years as a minimum for a player to be eligible for free agency. It explicitly states that players can have more than six of service before they are free agent eligible, but they cannot have fewer than six years. The six year line is a minimum, not a maximum, and nowhere in the CBA are players guaranteed free agency following their sixth calendar year in the Major Leagues.

The reality is that the rules, as they are written, give Major League teams control over a player’s rights for seven years, not six. And seven years of control is and has been the norm for nearly every player in MLB.

In MLBTradeRumors Arbitration Tracking tool, there are 179 players listed who were arb eligible this off-season. Of those 179, exactly 10 of them — 5.6% of the population — reached their service time level with the minimum number of days required and are on track to reach free agency with exactly six years of service. Six of the 10 are relief pitchers, who aren’t exactly going to hit it rich in free agency anyway. Only four currently active arbitration eligible regulars — Jason Heyward, Austin Jackson, Colby Rasmus, and Mike Leake — are on pace to reach free agency with the minimum level of service time. Everyone else is going to fall into the “or more” category, and will have had their rights controlled for seven seasons before they reach free agency, not six.

And this is why the Astros made George Springer a seven year contract offer. They already owned his rights for seven years. Teams can choose to forfeit one of those years of team control in exchange for a few extra weeks of production up front, but that’s simply not a good trade-off for big league teams to make, which is why almost no one does it. If the MLBPA wants to negotiate an end to service time manipulation in the next CBA, it will almost certainly have to agree to codify the seventh year of team control in order to do so. Because that seventh year of control already exists, for all intents and purposes.

Now, this isn’t to say that teams should be making young prospects take-it-or-head-to-the-minors offers. You don’t want the rules to allow teams to essentially force MLB ready players to sign bad contracts in order to get called up, but we should also acknowledge that there’s another interpretation of the facts here.

After all, we know that the contract offer to Springer was not made in isolation; the team reportedly also has made long term offers to both Robbie Grossman and Matt Dominguez, Major League players with minimal accomplishments at this point in their careers. As an organization, the Astros seem to be clearly betting on the positive expected value of signing early career contracts on the hopes that they get one big breakout star. If by locking up five young players, they avoid the massive cost escalation that would come from one of them developing into an All-Star, the savings from that one deal alone could cover the increased costs of signing the entire group.

In order to make this kind of bulk-buying strategy work, however, you have to actually get a pretty decent sized group of players to sign, and the Astros simply don’t have that many extension-worthy Major League players. One could even argue that Grossman himself is perhaps the least talented player we’ve ever seen offered a long term deal, and his inclusion in the group purchase strategy shows that the Astros have expanded their pool to include players who wouldn’t otherwise normally be extended offers at this point in their career.

Springer is certainly more talented than Grossman, and more worthy of a long term commitment from the franchise, but he’s also a prospect who has never hit in the big leagues before; based on MLB precedent, he too is an unusual candidate for a long term deal. The fact that the Astros offered a barely above replacement level guy like Grossman a multi-year deal suggests that perhaps their plan is less nefarious than it has been made out to be, and that they are simply attempting to limit their costs by applying Groupon’s business model to baseball players.

And keep in mind, these long term deals have nothing to do with short term cost savings. The Astros aren’t saving money in 2014 by sending Springer to Triple-A; they’ll have to pay at least the same league minimum salary to whoever plays right field as they would have had to pay to Springer. Their offer to Springer was about future cost savings, just like every other extension signed this winter. In pretty much every negotiation between team and player, the carrot that the team has to offer is guaranteed security now in exchange for a lower best-case scenario outcome if the player stays healthy and turns into a star. The Astros offered Springer $23 million worth of security for the rights to put a cap on his arbitration salaries, and likely to get an option or two on his first couple of free agent years. It doesn’t have to be viewed as a gun-to-his-head ultimatum tied to his desire to not spend a few more months in the minors.

More importantly, though, we should just accept the fact that Springer isn’t being robbed of anything that he has an actual claim to. The CBA does not give players the right to free agency after six years of team control. It gives him free agency after at least six years of team control, and that has developed into an accepted minimum of seven actual years for almost every player in baseball. There are very likely better ways to codify this so that teams wouldn’t have to option out top prospects for a few weeks at the beginning of their first year, but the first step to modifying the rules would be to accept that the window of team control is, in all practicality, actually seven years.





Dave is the Managing Editor of FanGraphs.

58 Comments
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Vlad the Impaler
10 years ago

The issue is the MLB definition of a “year”, which is 172 days of service time on a major league roster. The Tigers gamed the system by bringing Porcello up a few days into his 1st year.

He essentially will have pitched 7 full seasons in the majors before FA.

It’s a loophole. Loopholes will always be found and exploited.

If Springer signed the contract (offered in September of last year, by the way, not last week as portrayed by some) would he be the Opening Day RF? Probably. But even if he signed it and was making $750K in 2014, the Astros STILL may have kept him in the minors for a few months for development.

Same concept of sorts as with Puig and other Cuban imports of recent days. Guys still need fine-tuning, even with guaranteed contracts.

Anon21
10 years ago

“But even if he signed it and was making $750K in 2014, the Astros STILL may have kept him in the minors for a few months for development.”

With a team like the Astros, what’s the practical difference between developing in the minors and developing in the majors? In neither environment do you have a bunch of dedicated fans hanging on the outcome of every game, much media attention, or job insecurity.

CC AFCmember
10 years ago
Reply to  Anon21

The practical difference between hitting against Felix Hernandez instead of Brandon Maurer?

Anon21
10 years ago
Reply to  CC AFC

What better way to find out if a guy is able to hit major-league pitching, though? It’s not Hernandez out there every day; he’d face his share of okay-to-mediocre pitchers as well.

Florida South
9 years ago
Reply to  CC AFC

The guy almost had a 40/40 season last year. I think we know all we’re going to know about his performance against Brandon Maurer…

Travis L
10 years ago
Reply to  Anon21

It’s my understanding that teams prefer players to be at an appropriate level of competition in order to optimize their development.

Too hard of a league, and they can’t work on what they need to. Plus, it can stunt development (anecdotally) by bringing a player up too fast, because they are simply too overmatched.

If this weren’t the case, I think we would see teams put their 18 y.o. draftees right into AAA.

Ruki Motomiya
10 years ago
Reply to  Anon21

The difference is Delmon Young and other players who leap past AAA or with little AAA time to the majors. I could be wrong, but I am pretty sure players doing good without much time in AAA is the exception and not the rule.

Atreyu Jones
10 years ago

Isn’t the article claiming that the 6 years thing is a myth, and so it’s not really a loophole to get 7 years?

bookbook
10 years ago
Reply to  Dave Cameron

“the league will have to agree to either surrender the seventh year of control they already have — which would raise costs, since players would get to FA more quickly ”

Would it raise costs or shift costs? Wasn’t it Charlie Finley who argued that if the owners just gave up the six (plus) years of control supply would come into better balance with demand and the owners would save money? Or more simply, if the younger guys get big free agent contracts a year earlier, would the teams spend less elsewhere to compensate?

I’m trying to imagine a non-gamable system that would remove the perverse incentive to keep good players in the minors too long… I don’t really see what would be practical. (Super-two is actually worse–missing two weeks of play is basically just a long road trip or a short DL stint, but 2 or 3 months feels like we’re stealing a real irreplaceable bit of a player’s talent just to game contract status.)

Brian
10 years ago
Reply to  bookbook

I’ve always thought they should have every team kick in something like $2M, then dole out the $60M as merit compensation to the guys making the minimum, or thereabouts (admittedly, it’s a half-baked idea). So Trout might get an extra $2M in merit pay, while John Q Reliever gets an extra $100K for putting up a 3.50 ERA in 40 innings.

Not that this fixes the service time issue, but it at least might re-allocate some of that money available only for free agents to players that outperform the free agents, without taking away the 6-7 years of team control, which is one of the only things that allows a $70M payroll team to compete with a $170M payroll team.

vivalajeter
10 years ago
Reply to  bookbook

Brian, if the players are worried about the minimum wage rookies, then they can get that $60MM from the overpaid players who are playing like crap. Pujols and Hamilton can give a few million to Trout, Johan Santana could’ve given some money to Harvey last year, etc.

Mark
10 years ago
Reply to  bookbook

It’s counter intuitive, but the 6 year thing was actually the Union’s idea–and it wasn’t considered a “concession”. Marvin Miller was just that smart and realized that by giving up money early in their careers, the guys who made it past six years would make orders of magnitude more money through this kind of limited free agent market model. They did the research and came up with six years as the “Sweet spot” for what players could make (Versus the risk of not having a long enough to career to earn big). The league at the time didn’t understand this, and when the union proposed it thought it was a sweet deal, but Miller knew it was really a HUGE win for the players to have this kind of system in place, especially since the league thought they were getting it as a concession!

Atreyu Jones
10 years ago
Reply to  bookbook

Mark, what do you mean? How is it better for the union for the teams to have 6ish years of control compared to 5 or 4?

rogue_actuarymember
10 years ago
Reply to  bookbook

I realize that this wasn’t directed at me, but I think I might be sufficiently qualified to answer.

Think of a teachers’ union. Most of the voting members in the union are older teachers with tenure. Their jobs are secure. When lay-offs are necessary, school districts are often (generally) contractually obligated to start with the teachers who have the lowest service time.

This is bad for the young teachers, but good for the larger/older majority.

With the MLBPA, the guys who are overpaid are almost never young players. It’s always guys who signed big deals as FAs. Money is basically being taken away from players with less than 7 years of service time and re-allocated to players on the other side of that barrier.

A good counter-example is the NFL. NFL contracts aren’t guaranteed, but some of the biggest contracts each year are signed by the top draft choices. In baseball, that money isn’t going to draft picks and young players.

The result is that the $/WAR quotient for FA-eligible players is actually higher than it would be if everyone was cut and available as a free agent. If teams had to pay their younger players market wages, there would be less money available for the older players. It isn’t really the supply of WAR that is being constrained, but rather teams don’t need to spend money on young and good players.

Like in a fantasy baseball dynasty league. All of the owners presumably “keep” players who offer surplus value over their salaries. Replacement level is independent of the salaries. So there is a fixed amount of “points above replacement” available. If owners keep, say, 25% of the overall points above replacement at, say 15% of the cost, then 85% of the remaining budgets are available to be spent on 75% of the remaing points above replacement.

Except, in real baseball, it isn’t all players offering surplus value, but rather the young/early career players.

pft
10 years ago
Reply to  bookbook

Mark, 6 years was a concession by MLBPA. Originally Marvin Miller tried for 3-4 years I believe, and MLB wanted 10. They compromised at 6 years with arbitration after 3 years.

Technically, without the CBA, MLB only gets 1 year of control over players, and that’s their first contract year, after which every player would be a free agent.

Vlad the Impaler
10 years ago
Reply to  Dave Cameron

Perhaps you do something like saying 7 calendar seasons of control. So if you call a guy up in late April, mid May, or Sept callup, it’s all the same.

dls
10 years ago

But that simply encourages the MLB team to not call the player up… at all. Which doesn’t help either.

Set a fixed age? After your age 30(?) season, you can become a free agent. This would actually encourage teams to aggressively promote MLB-ready talent.

You could quibble about the age I guess. What is the average age of free agents nowadays? I’m thinking its around 30-31.

witesoxfan
10 years ago

But if you set a fixed age, then teams will be more inclined to rush their prospects up so they can control them for a longer period of time which is also not good for future earnings.