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Baseball Salary Arbitration

By Rick Karcher, Michael McCann, Geoffrey Rapp, Greg Skidmore, and Howard Wasserman

I am pleased to have the opportunity to share with Sports Law Blog readers some of my insights and research concerning baseball salary arbitration. Going back to my time teaching a seminar on the regulation of the sports and entertainment industries at Loyola New Orleans in the 1990's, I have been interested in the arbitration process. In particular, I was interested in researching the decisions of individual arbitrators to determine their team-player record. It was oft asserted that in order to remain an arbitrator you needed to maintain a roughly 50-50 decision percentage. I have been able to locate arbitrator information back to 1984 through research in newspaper articles on Westlaw and LexisNexis. My interest in the process began to expand beyond that particular point. Over the past five years and with the help of numerous research assistants, we have researched all 3,000-plus players who have filed for arbitration since 1974. Over the next month, I hope to post comments about the 2008 process.

This year, 110 players filled for arbitration by the Tuesday, January 15 deadline. By the Friday, January 18 deadline for exchanging numbers, only 48 players remained unsigned.

One of the most intriguing stories of the this year involves the Phillies and Ryan Howard. The Phillies enjoy a 7-0 won-loss record over their players since the beginning of salary arbitration in 1994. The Rays are the only other team without a loss to a player. They have gone to 3 hearings. By the way, the Phillies unbeaten streak breaks down as follows: Willie Banks (1996), Kevin Gross (1987), Alan Knicely (1986), Jerry Koosman (1985), Travis Lee (2001), Dale Sveum (1992), and Dickie Thon (1991).

Howard requested $10 million and the Phillies countered with $7 million. The gap is $3 million with a midpoint of $8.5 million. Although Howard did not match his offensive production during his 2006 MVP season, he will substantially increase the $900,000 that he received last year. That deal was the largest for a player with less than two years of service time. Howard is eligible for arbitration as a Super 2 player. Phillies General Manager Pat Gillick and Assistant General Manager Ruben Amaro, Jr. are in discussions with Howard?s agent Casey Close. Could the result here be a long term contract?

The Phillies had six players who were arbitration-eligible this year. The only other player that they exchanged numbers with is Eric Bruntlett. Bruntlett wants $800,000 while Philadelphia offered $550,000. The midpoint is $675,000. Prior to the exchange of numbers the Phillies reached agreements with Brad Lidge ($6.35 million), Ryan Madson ($1.4 million), Chris Snelling ($450,000), and Jayson Werth ($1.7 million).

Full post as published by Sports Law Blog on January 25, 2008 (boomark / email).