Tuesday, February 10, 2009

IFA Contracts

The Reason for the IFA and Amateur Draft MLB contract change. It was noted by the MLB Players Union that many blue chip prospect players were being signed to long term MLB minimum deals short-changing their arbitration payoff in years 4 and 5 of their contract. After long labor intensive negotiations it was decided that a player could be offered a minimum MLB contract for 3 years but for a longer contract, it must be initiated by the player or his agent. It was determined that compensation for years 4 and 5 of a long term contract would be commensurate with that of a FA.

In simple terms, year 4 and 5 of a long term contract would be a minimum of $5M and not exceed the $20M cap. In retrospect an error occurred where all 5 years of a long term contract had to meet the $5M minimum without the players consent, though the intent was about as clear as mud. Supposedly this is fixed and now works as planned. I have tested and you can offer a 3 year MLB deal at the ML minimums. I have no way of testing for years 4 and 5 as of yet and whether only years 4 and 5 require the $5M minimum or in fact all 5 years.

After thinking about the change and its intent, someone at the Players Union needs to go back to college IMHO. As it stands, if a blue chip prospect player is signed to a MLB contract and put onto the ML roster immediately and before the 23 game deadline then yes he could be short-changed by two years. In most cases however, he would only be short-changed by possibly 1 year at the most. Currently this change would possibly affect maybe one or two players per year at the most. The chances of seeing a player requesting a long term contract will only be slight if at all.

Although I do see the intent if a blue chip prospect is 22+ years old but there are few of those also as most are 18 to 20. A younger players 5 year MLB contract would expire and he would be Rule 5 eligible but not a 6 year minor league FA and not arbitration eligible either if he doesn't have the ML service time under the old rules. A 22+ year old would be 27 or older and probably have the ML service time before the contract expired, but possibly by only 1 year.

Now a blue chip prospect player would only have a 3 year contract and probably gains nothing or maybe even less. So a wise GM will actually beat them at their own game in the end and the players will still go home empty handed.

Is it possible there are plans that more International prospect players may be older and ML ready? Very few players are currently scouted that are over 20 years old where a 5 year MLB contract could have actually hurt a player. If this is the case then we need to watch and see what happens.

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