Comparing First-Year Eligible Arbitration Signings
The 2009 salary arbitration process, which was collectively bargained and implemented in 1974, has come and gone with the players making out just fine. Of the 111 players who filed for arbitration last month, 65 settled prior to exchanging salary figures, 43 negotiated contracts after submitting numbers, and only three cases were heard by arbitration panels (with the players winning two and losing one).
Florida Marlins second baseman Dan Uggla won his arbitration case and will make $5.35 million rather than the $4.4 million the team offered. Washington Nationals righthander Shawn Hill was awarded his asking price of $775,000 instead of the $500,000 submitted by the club. Tampa Bay Rays catcher Dioner Navarro, on the other hand, lost his arbitration case and will make $2.1 million rather than the $2.5 million he was seeking. Don't feel too badly for Navarro as he will still pull down $1,667,500 more than the $432,500 he earned in 2008.
Maury Brown of The Biz of Baseball has compiled all of the vital stats. According to Maury, the average year-over-year increase in salary for the 111 players who filed was a "whopping 751 percent."
As Fred Claire observed, "The arbitration-generated salaries are in sharp contrast to what has happened in this year's free-agent market where a number of high-profile players have had to sign contracts far below their expectations and a number of other 'name' players remain on the sidelines without contracts."
What was of interest to me were the number of contracts that were negotiated at or near the midpoint with little interest on the part of players and owners to "win." I put together a list of ten first-year eligible position players who signed one-year contracts earlier this month to avoid salary arbitration with the objective of analyzing these deals. There were several others who avoided arbitration by signing longer-term agreements. The latter transactions are much more difficult to compare than the relatively simple and straightforward one-year deals.
Before we get too far ahead of ourselves here, I thought it would be instructive to review the ins and outs of salary arbitration. The Major League Baseball Players Association provides the following primer on its website.
Q: When does a player become eligible for salary arbitration?
A: A player with three or more years of service, but less than six years, may file for salary arbitration. In addition, a player can be classified as a "Super Two" and be eligible for arbitration with less than three years of service. A player with at least two but less than three years of Major League service shall be eligible for salary arbitration if he has accumulated at least 86 days of service during the immediately preceding season and he ranks in the top 17 percent in total service in the class of Players who have at least two but less than three years of Major League service, however accumulated, but with at least 86 days of service accumulated during the immediately preceding season.
The details of the ten negotiated contracts referred to above are provided in the following table, along with positions, ages, major league service time, and career batting (AVG/OBP/SLG/OPS+) and fielding (Ultimate Zone Rating per 150 games) rate stats:
POS BORN ML SERV CONTRACT AVG OBP SLG OPS+ UZR/150
Andre Ethier RF 4/10/82 2.153 $3.100M .299 .364 .482 116 0.1
Jeff Francoeur RF 1/08/84 3.088 $3.375M .268 .312 .434 92 9.6
Corey Hart RF 3/24/82 3.038 $3.250M .277 .323 .485 106 -0.5
Conor Jackson LF 5/07/82 3.067 $3.050M .287 .367 .443 105 11.5
Mike Jacobs 1B 10/30/80 3.047 $3.250M .262 .318 .498 110 -8.6
Kelly Johnson 2B 2/22/82 3.127 $2.825M .273 .356 .440 108 -9.1
Ryan Ludwick RF 7/13/78 3.109 $3.700M .273 .345 .512 122 10.3
Rickie Weeks 2B 9/13/82 3.131 $2.450M .245 .352 .406 97 -10.9
Josh Willingham LF 2/17/79 3.123 $2.950M .266 .361 .472 117 -6.0
Ryan Zimmerman 3B 9/28/84 3.032 $3.325M .282 .341 .462 110 10.0
The average contract calls for a 2009 salary of $3,127,500. Ryan Ludwick ($3.7M) received the highest amount of money and Rickie Weeks ($2.45M) the lowest with the other eight tightly bunched in a range of $2.95M (Josh Willingham) to $3.375M (Jeff Francoeur).
Although Andre Ethier only had 2.153 years of MLB service, he was eligible for arbitration as a "Super Two." Ethier ranks first in AVG, second in OBP, fourth in SLG, and third in OPS+, yet agreed to a deal that was only the sixth highest overall and last among his peers in right field. This one looks like a better deal for the Dodgers than Ethier.
Francoeur and the Braves agreed to a salary that was exactly in the middle of the figures that were exchanged ($3.95M and $2.8M). He has the worst OBP and OPS+ of them all despite manning a corner outfield position. He is the second-youngest player in the group but that is neither here nor there when it comes to salary arbitration. He is one of the most overrated players in baseball and his contract is a huge win for him and a disservice to the arbitration process.
Corey Hart re-signed with the Brewers for the average of what each side wanted ($3.8M and $2.7M). No performance bonuses were attached to the deal. Hart's stats pale in comparison to Ethier but his back-to-back 20 HR/20 SB seasons give his numbers more sizzle in an arbitration hearing than his similarly aged counterpart. I would call this one a fair deal for both sides.
Like Hart, Conor Jackson and the Arizona Diamondbacks reached a settlement that split the difference between what each side submitted ($3.65M to $2.45M). There were no performance bonuses. His UZR rating in left field is based on a small-sample size, and it is still possible that he could end up at first base (where he sports a -3.5 UZR/150 games rating) if Eric Byrnes is healthy and productive enough to win back his job in left. Let's call this one a draw.
Mike Jacobs signed with the Royals at a price ever so slightly below the mid-point of what he asked for ($3.8M) and what the club offered ($2.75M). The first baseman can make up the gap of $25,000 by being named to the All-Star team. He has the second-highest SLG but plays a position that demands power, especially when one doesn't get on-base more often or contribute in a more positive manner defensively. When KC acquired him, I figured he wouldn't make more than $3M in arbitration. I stand corrected and believe his contract is a bit on the high side given his overall production.
Kelly Johnson and the Braves met at the halfway point of their submissions ($3.3M and $2.35M, respectively). The second baseman can earn $50,000 if he reaches 620 PA and another $25,000 for 670 PA. At best, Johnson can make $2.9M, which would be the second-lowest agreed-upon salary in this group. I believe this deal is the opposite of Francoeur's — a good one for the team and a bad one for the player. If anything, this contract is another in a long line of examples where second basemen are treated unfairly by the system.
The gap between the Cardinals offer ($4.25M) and Ludwick's asking price ($2.8M) was the largest in this sample. It appears as if St. Louis tried to lowball him initially because he wound up receiving a salary that was much closer to his side plus the following performance bonuses: $25,000 each for 625 and 650 PA and an additional $50,000 for 675 PA. Ludwick ranks first in career SLG and OPS+ and is coming off the best season, by far, of any of these players. However, he was rewarded handsomely for his contributions.
Weeks and the Brewers avoided arbitration by agreeing to a $2.45M deal, which was just above the mean of what each side submitted ($2.8M and $2M). Weeks can also earn the following performance bonuses: $25,000 each for 575, 600, 625, 650 PA although it should be pointed out that he has never reached any of those levels in a four-year career that has been marred with injuries and disappointments. It looks like a fair deal based on actual performance but potentially a smart one on the part of the team if Weeks finally fulfills his promise.
Willingham signed with the Nats at a price below the mid-point of the salary ranges ($3.6M-$2.55M). He will earn $25,000 at each of the following plate appearance totals: 525, 550, 575, 600. All told, Willingham can make $3.050M in salary and bonuses, which is just below the average of what each side submitted. His contract is lower than any other outfielder and appears to favor the team slightly more than the player.
Ryan Zimmerman was re-signed by Washington exactly between what the Nationals offered ($3.9M) and what the player submitted ($2.75M). He will receive the following performance bonuses: $75,000 for 500 PA and an additional $50,000 each for 550 and 600 PA. If he reaches 600 plate appearances, Zimmerman will make $3.5M in salary and bonuses. Zimmerman has the fourth-highest career OPS+ and is undoubtedly the best fielder in the peer group at one of the most challenging positions. This is a deal that will most likely pay off for both sides should the youngest player earn his performance bonuses.