Still No Baseball? MLB Updates + Luxury Tax Explained

What’s happening in MLB these days? Mostly just talking. MLB and the MLBPA are trying to reach an agreement about when the 2020 season will start, how it will be structured, and how players will be paid.

Here’s what we know about the latest MLB proposal:

• Regular season games would start around July 4, 2020
• The spring training do-over this late start necessitates would begin in June
• No more than three exhibition games before the start of the regular season
• 82 games in the regular season
• The final scheduled regular season game would occur around the usual time, September 27
• Extra wild card games; 14 teams in the playoffs rather than the usual 10
• Stadiums would remain empty

The biggest dispute of the moment isn’t about season structure but about pay. In March, the MLBPA agreed that players would receive a prorated salary: they’d get paid at their regular rate for however much of the season they actually end up working. But now, MLB is proposing further cuts on a sliding scale. Top players’ salaries would be cut by 77%, which sounds like a big deal; the union certainly isn’t pleased with this proposal. But when you look at the actual numbers, it mean salaries would be reduced from multiple millions of dollars to fewer multiple millions of dollars. The minimum salary a Major League player would earn this year is $262,217. The MLBPA is unlikely to agree to this cut, but I suspect the Major League players will be just fine no matter what.

Of course, we don’t know what will actually happen until MLB and the MLBPA officially come to an agreement.

Minor League players, predictably, are in a tighter spot. Here’s what we know:

• Minor League games are almost certainly not going to happen this year
• Lots of minor league players are being let go, although that usually happens around this time of year and it’s not clear whether teams are letting go more players than usual
• Many teams have agreed to pay Minor League players a weekly stipend through June; it’s not clear what will happen after that

When I started this blog, I never expected I’d be writing so much about money. But I guess it’s not surprising that money drives so much of what happens in baseball. Heck, there’s a movie about it.

A guy named Scott Boras recently got mixed up in MLB financial negotiations when he sent an email claiming that baseball teams are exaggerating the amount of money they’ll lose by paying players the agreed-upon prorated salary. Boras, a player agent, named the Cubs, saying owners like the Ricketts claim they don’t earn much because they have loans to pay off, but that their debt is a result of investments like stadium improvements that will earn them more money in the long run. A Ricketts representative responded, pointing out that the Cubs have one of the top payrolls in baseball and claiming that they will, in fact, lose lots of money this year because 70% of their revenue comes from fans at games.

The Cubs have a lot of money: they exceeded their luxury tax threshold last year and are expected to do so again in 2020. The luxury tax is a cap on how much teams can spend without incurring penalties. The idea is that this cap allows less-wealthy teams to acquire good players. Many baseball fans argue that the luxury tax is pretty pointless, though. For one, wealthy teams like the Cubs regularly exceed the threshold and just pay the penalties. Also, a lot of teams treat it like a player salary cap: they use it as an excuse to keep players’ salaries low (relatively speaking!) even though they aren’t really restricted by it. Whether teams like the Cubs can reasonably afford to pay prorated salaries is unclear: clubs aren’t releasing the actual numbers showing how much money they’re projected to lose.

In any case, although Boras is speaking out in support of players, he’s essentially been told to keep his nose out of union business.

One last interesting update concerns the Toronto Blue Jays. Because of border restrictions between the US and Canada, they might not be able to play home games this year. Although things could easily change, they’re currently considering playing home games in Dunedin, FL, their spring training base.

That’s it for baseball news for now. Sources for these updates include AP, Yahoo! Sports, CBS Sports, NBC Sports Chicago, TSN.ca, and Sportsnet.ca. I read it all so you don’t have to, but if you’re interested in more up-to-date news before I get around to condensing it, you can check those sites. I was hoping the MLB At Bat app would keep me updated on the latest in the world of baseball but it does not…probably because none of what’s happening these days is particularly good publicity for MLB.