In 2009, 111 players filed for salary arbitration. Before players and clubs exchanged figures on January 20, sixty-five of these players had agreed to contracts with their clubs. Of the remaining 46 players, only three players actually went to an arbitration hearing, tying the low point set in 2005.
It was the first time that the majority of the decisions went in favor of the players since 1996. Since the first hearings were held in 1974, the clubs have won on 280 occasions and the players have prevailed 207 times.
By my count, here is the breakdown of the 111 cases.
- 93 players signed one-year contracts.
- 15 players signed multi-year contracts.
- 3 players had their salary determined at an arbitration hearing.
There are two situations where arbitration can come into play. By far the most common is the one involving players, under control of their clubs, with 3 to 6 years of major league service (MLS), plus the 17% most senior MLS-2 players, referred to as "super twos". Of the 111 players who filed this year, 109 were in this category.
(Editor's note: Five Cardinals were in this group. Brad Thompson, Chris Duncan and Todd Wellemeyer came to terms prior to exchanging figures with the club. Rick Ankiel and Ryan Ludwick settled with the Cardinals just prior to their scheduled arbitration hearings. For details on their signing amounts, click here, "Ludwick agrees: Cardinals arbitration scorecard complete".)
The other situation involves free agents. When a player with 6 or more years of major league service files for free agency, his club has the option of offering arbitration. A club must offer arbitration in order to get compensation in the form of draft picks if the player signs with another club. If the player accepts arbitration, he is no longer considered a free agent and he becomes bound to that club. If a player refuses arbitration, as most players do, he is a free agent who can sign with any club including the one he played for last year. Of the 24 free agents who were offered arbitration this year, the only two that accepted were Darren Oliver of the Los Angeles Angels and David Weathers of Cincinnati.
the economic uncertainties this year, the market was more difficult to
read. A number of free agents, such as Jason Varitek of
The arbitration process is designed to promote a settlement at a salary in line with that of other players with comparable performance and service time. Players eligible for arbitration for the first time receive a large increase in salary since they have no leverage in their pre-arbitration years when their salaries are under control of the clubs. Players who have been through the process before also generally receive salary increases depending on their performance in the preceding year.
Players that settle prior to hearings are frequently able to include performance bonuses, based on playing time, and awards bonuses in their contracts.
big winners in the arbitration process this year were Nick Markakis of
The relatively quiet arbitration season this year suggest that the system is working as designed in achieving benefits for both sides. Players with 3 to 6 years of major league service receive salaries that are influenced by their market value and Clubs are able to retain the rights to these players through 6 years of major league service before they become eligible for free agency.
Bill Gilbert is a baseball analyst and writer and member of the Society for American Baseball Research (SABR).