As an inevitable spring lockout approaches, Major League Baseball has revised the salary cap and floor plan it first proposed in July. The importance of these details is different than sports leagues that already have salary caps, where numbers are everything. In MLB, the fight is over the existence of a salary cap, with owners offering version after version of what a cap might look like, and players pointedly refusing, baseball bat in hand, until the basic question of yes or no has been answered.
The latest version, proposed by MLB on Nov. 3, would delay implementation of a cap from 2027 to 2028. This is less of a concession to players than to teams, giving them a full offseason to prepare rather than jumping into a cap system immediately after a lockout. The new numbers offered by MLB are projections, dependent on league revenue, that will likely change dramatically in 2027 depending on the length of the lockout.
To simplify, the proposed projected cap would be $258.2 million and the floor would be $180.2 million, or about 70% of the cap. In theory, this would mean players would receive a 50 to 50 percent share of league revenue. But as with all capping systems, the finer details depend on how revenue is collected and how spending is defined.
It would be highly unusual for a class of billionaire owners – many of whom have shown little interest in the definition of a “competitive” or “winning” baseball team over the past decade – to propose a system that would cost them money, simply for the sake of competitive parity. A salary cap and floor would use the same system as current payroll calculations, which include the cost of employee benefits. As noted in Jeff Passan’s explanation of the current proposal, the owners want to deduct stadium costs from pre-shared revenue, which would significantly reduce the players’ theoretical share. MLB also counts amateur signing bonuses for drafted players and international amateur free agents, expected to total $550 million this year, to distribute player income; for players in the majors to cumulatively earn more next year than this year, that figure would have to be reduced by several hundred million dollars.
According to the MLBPA, players already receive more than 50 percent of the league’s revenue, and the cap would reduce player salaries by $500 million. Guaranteed salaries, as they currently exist in MLB, would also change under this proposal: MLB has suggested that up to 10 percent of players’ salaries be locked in, which could potentially be recouped if players’ revenue share exceeds 50 percent.
Other parts of the proposal are not, in a vacuum, tied to the existence of a salary cap, although owners will associate them as a negotiating tactic. These include raising the minimum salary to $1 million – a figure that is itself a bit misleading, as that value includes a new $100,000 bonus given only to players with less than two years of service who have played a full season and spent less than 50 percent of it on the injured list – and providing earlier access to free agency.
Competitive balance also does not require a salary cap, nor is it simplistically guaranteed by a salary cap. The Milwaukee Brewers are, after all, the best team in baseball and the new World Series champions. Meanwhile, even a mandatory infusion of hundreds of millions of dollars won’t save the Colorado Rockies.
Gn sports
