November 10, 2003

Breaking Balls

Draft Slotting

by Derek Zumsteg

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The rumblings about collusion, and specifically about whether Major League Baseball implemented a contract clearing house they wanted in the last Collective Bargaining Agreement but did not get, continue. What's been largely overlooked is the "slotting" of draft-pick signing bonuses in recent years as MLB has taken over more of the negotiation process from teams.

Slotting is the practice, codified in other sports, of giving draft picks certain dollar amounts according to their draft position. It eliminates negotiation almost entirely, and for owners in the NBA, for example, it means that their labor costs are certain and low.

I am frankly surprised that a good agent who represents premium talent--Scott Boras, for instance--has not hauled baseball into court over this. Even if you buy that the Players Association can bargain away the rights of players it doesn't represent and doesn't look out for (minor league players are not union members), nowhere in the latest CBA is anything mentioned about the slotting of picks.

The MLBPA isn't likely to make a fuss. The players who make up the union don't care if some high school kid gets paid $5 million or $500,000. Their union protects major league players only, and in the view of many players, money paid out to young prospects in signing bonuses is money that should be put into payroll to be spent on established veteran players, like themselves.

Check out this progression:

(That spike there is Joe Borchard, since I know you're wondering, who messes up my whole scale.)

What's interesting is the curve has smoothed out dramatically: where there used to be a "whoosh" of a slope from the first batch of picks (like 1-10) evening out to a longer, gentle descent, that long descent's being moved up, until eventually (unless someone breaks up this tea party) I suspect we'll see the first picks of the first round get only a little more than the last picks of the first round.

And there you go. I look forward to the lawsuit some agent's going to file against MLB. It'd be interesting to see if MLB even defended itself, or immediately settled. The discovery process would almost certainly turn up a lot of information on what MLB's labor offices have been up to.