With MLB Lockout Over, Here Are All The Details Of New 2022-26 Labor Deal

On Thursday evening, the owners and players in Major League Baseball reached a new labor deal and with it, ended one of the longest work stoppages in league history while salvaging a full season and pay for the players.

The historic deal ended on the 99th day of the league-imposed lockout and was the second-longest work stoppage in league history behind only the 232-day player strike that wiped out the 1994 World Series and rolled into the 1995 season. In reaching the deal on what was seen as the last day before regular-season games would be canceled, the owners will claim they have not yet imposed a lockout that has caused the cancellation of any regular-season games.

In a press conference following the agreement, commissioner Rob Manfred said, “I am genuinely thrilled to be able to say that Major League Baseball is back and we’re going to play 162 games. I do want to start by apologizing to our fans. Looking forward, I could not be more excited about the future of our game.”

“Our union endured the second-longest work stoppage in its history to achieve significant progress in key areas that will improve not just current players’ rights and benefits, but those of generations to come,” MLBPA executive director Tony Clark said. “Players remained engaged and unified from beginning to end, and in the process reenergized our fraternity.”

The MLBPA’s press release following the announcement ended by saying, “Players are excited to get back on the field, join their teammates and compete in the game they love.”

Said Manfred of the negotiations with the players, “I’ve never been surprised at the solidarity of the MLBPA. It may be one of the best unions in America. It has been historically, that’s for sure.”

When asked about the contentious nature of the negotiations, Manfred said he took part of the blame for it.

“One of the things that I’m supposed to do is promote a good relationship with our players,” Manfred said. “I’ve tried to do that. I think that I have not been successful in that. I think that it begins with small steps. It’s why I picked the phone up after the ratification and called [MLBPA executive director Tony Clark] and expressed my desire to work with him. It’s going to be a priority of mine moving forward to try to make good on the commitment I made to him on the phone.”

The details of the deal are sweeping and historic. Here’s a breakdown of the deal.

Lockout Official End: 7pm ET on Thursday, March 10, 2022. Free agency, trades, salary arbitration signings allowed to move forward.

Duration: Five years (2022-2026)

Ratification: The owners voted 30-0 in favor. The players’ board voted 26-12 to accept the deal. But the executive board that is often seen as making recommendations to the players voted unanimously against the deal showing how the average player wanted to play:

Regular-Season Start: The league pushed out the start of the season from March 31 to April 7. A full 162 games will be played by pushing the regular season out three days and making up other games with 9-inning doubleheaders.

Spring Training: Players will start reporting to Spring Training on Friday, March 11. Some players, including those out of the country, will arrive later. Exhibition games will begin on March 17 or 18.

Expanded playoffs: The owners wanted 14 teams in the postseason but, in the end, agreed to 12 that the players accepted. The top two division winners would receive a bye in the playoffs.

No More Tiebreaker Games: In the past, teams that had identical records at the end of 162 games in a division would play game 163 — a tiebreaker. Now, that system is gone. Instead, MLB will now follow a system more closely aligned with the NFL for determining ties. This is largely due to increased playoff games and lack of slack in the regular season scheduled.

Universal Designated Hitter: The National League will see the designated hitter as a regular function of the roster for the first time in its history. It was used in the NL only for the 2020 pandemic-shortened season.

Sponsor Patches and Helmet Decals: Clubs will be allowed to reach their own sponsorship deals for sponsor patches on jersey sleeves and decals on helmets. The players do not get a direct percentage of that new revenue.

Increase In Minimum Salary: The minimum salary for players sees a significant increase jumping $129,500 from 2021 to $700,000 in 2022. It is the biggest single-year nominal increase to the minimum salary in MLB history. The 22.7% increase in the minimum salary is the biggest single-year percentage increase since 2003. From $700,00 it will increase $20,000 each year after in the agreement.

• 2022: $700,000
• 2023: $720,000
• 2024: $740,000
• 2025: $760,000
• 2026: $780,000

The negotiated minimum growth throughout the new labor deal is a significant improvement over those negotiated in the previous three CBAs.

6.5% annual growth v. 2.4% in the 2016 CBA, 4.2% in the 2011 deal, and 4.8% in 2006 agreement.

Increase In The Competitive Balance Tax (CBT): The CBT, also known as the Luxury Tax was a contentious issue in negotiations as the players saw the owners using it as a de facto salary cap instead of a mechanism to stop runaway spending. The CBT will grow twice as fast as it has over the last two CBAs.

Thresholds are now:

• 2022: $230 million
• 2023: $233 million
• 2024: $237 million
• 2025: $241 million
• 2026: $244 million

New Third Level Surcharge: In the last labor deal the owners got a surcharge tax system in place that increased penalties for those going far over the thresholds. These surcharges were set at two levels and added financial penalties to those that not only surpassed the CBT thresholds but by how much. In each consecutive year, those penalties increase. As part of what many are calling the “Steve Cohen provision” – a reference to new Mets owner Steve Cohen who is expected to spend lavishly to try and win, the league got a third level which kicks in at $290 million.

New Pre-Salary Arbitration Bonus Pool: A brand new aspect is the addition of a bonus pool to reward players that perform at high levels before they enter salary arbitration. All clubs will pay into the pool which will be $50 million that will be distributed to the top 100 players based on awards and statistical performance. The system to determine that statistical performance will be worked out by the league and MLBPA and is likely to follow WAR or some variation. According to MLB.com, under this system, NL Cy Young Award winner Corbin Burnes would have seen his salary jump from $608,000 to $4.2 million last season, while Rookie of the Year winners Randy Arozarena and Jonathan India would have seen their respective salaries more than triple in 2021.

Additional Service Time For 1st and 2nd Place ROY Winners: In the new agreement, players that finish 1st and 2nd in AL and NL Rookie Of The Year voting will receive one full year of service time.

Salary Arbitration Salaries Guaranteed: As part of the new labor deal, all players in salary arbitration will see their salaries guaranteed.

International Draft: For more than 20 years, the owners in the league have sought an International Draft where cost certainty can be determined by slots, and control corruption in Latin America where pseudo- agents have skimmed huge percentages out of signing bonuses off young players. The players had been opposed as they saw it as controlling the free market. It’s not a done deal, but if the union accepts the new International Draft by July 25, 2022, the league will eliminate the qualifying offer system that is used for direct draft-pick compensation for free agents.

Details:

• Would be 20 rounds, or over 600 players selected.
• Signing bonuses would be guaranteed
• In countries that are emerging – less that 0.5% of international signings over the last three signing periods – clubs that select from those countries will get additional selections to foster scouting and development from emerging markets.
• Total value increase from prior labor deal to the 2022-26 deal to amateur signings is expected to be approximately $20 million.
• Draft picks would be allowed to be traded.

New Draft Lottery Selection System: In an effort to stop teams from tanking to garner the highest draft picks, the league and players agreed to a new process that is closer to what the NBA has. Now, the top six selections in the Rule 4 Draft will come via lottery selection. Odds would run in reverse order of a team’s winning percentage the season before. The bottom three clubs would each have a 16.5% chance of winning the first selection in the draft.

According to MLB.com, the 18 non-postseason clubs would be eligible, though revenue-sharing payees would be ineligible to receive lottery selections in three consecutive years, while non-payees would be ineligible to receive lottery selections in consecutive years.

Options Limited To Help Slow Service Time Manipulation: For years the players have accused the owners of keeping major league ready prospects down in the minors in an effort to manipulate their service clock and keep them under club control for an additional year before they hit free agency. Now, players will only be able to be optioned no more than five times down to the minors to try and slow that practice.

In addition, there are now draft pick incentives for clubs that promote top prospects and avoid service time manipulation.

Shortened Period For Commissioner To Implement On-Field Changes: In the last labor deal, Rob Manfred had the ability to unilaterally make on-the-field rule changes with one year’s notice. In the new agreement that has been shortened to 45 days. Manfred sees this as key to growing the pace of play.

New Joint Competition Committee: As part of those changes, the league and union will create a new Joint Competition Committee that will be comprised of four active players, six members appointed by the league, and one umpire. As part of that effort, beginning in 2023 they will be tasked with rules around a pitch clock, enlarged base sizes, defensive shifts, and eventually an automatic strike zone.

$500 Million Grievance Dropped: The league sought – and the MLBPA agreed – to have the union drop a $500 million grievance over the length of the 2020 season played at the beginning of the pandemic. The players believed they could have played more than 60 games that were unilaterally imposed by Manfred. The players did not agree to drop a grievance against the Pirates, Rays, A’s, and Marlins for misuse of revenue-sharing funds.

Increase In Number Of International Exhibitions: The league and MLBPA agreed to play exhibitions or “tours” over the life of the new labor deal in the following countries:

• Mexico
• Asia
• Puerto Rico
• London
• Paris
• Dominican Republic

Other changes

• A voluntary scouting combine for amateur prospects
• A new policy for the players governing commercial arrangements with sports betting companies
• Improved benefits to former players