Report: Significant Differences Exist in CBA Negotiations, Owners May Lock Out Players

In a report made by Ken Rosenthal, the owner’s are considering locking out the players if they cannot reach an agreement on a new collective bargaining agreement by the December 1st deadline. As a refresher, the CBA expires on December 1 and both sides have repeatedly stated that they are close to an agreement. This is the first indication from either side that there may be issues getting to an agreement by the deadline.

Apparently, the owners are frustrated by the slow pace of negotiations they blame on the players union. This comes as there are still a number of significant issues that remain outstanding. Of those issues, here are the three biggest ones:

• International draft – the owners want to implement an international draft but the players union strongly believes this will drive salaries down for international players coming into the league. This is likely the single biggest issue for the players in a possible new CBA.
• Qualified offer – the players want to eliminate draft pick compensation that is currently required if a team signs a player who’s been offered a qualified offer by his original team. The thought is that requiring a draft pick as compensation for signing a free agent is too high a price for teams to pay and thus it discourages teams from aggressively pursuing these players.
• The luxury tax threshold – this is the payroll limit (currently $189 million) that, once exceeded in a given year, requires teams to pay a penalty, better known as the competitive balance tax, for exceeding the set limits.

With these issues, and some other minor ones, in play it would appear to be feasible to be able to get to an agreement done by the deadline, in eight days. Of course, there’s Thanksgiving coming up and that may shorten the amount of time to get a deal done to something less than the days remaining until December 1.

On the surface, there are one of two things going on here.

It’s possible that this is a negotiating ploy by the owners. From the tone of the Rosenthal article, and his interview on MLB Network, it seems like the biggest issue is the international draft. The owners offered to get rid of part of the draft pick compensation in exchange for the players agreeing on an international draft. That was not nearly enough, according to an anonymous source on the players’ side. So, perhaps the owners have leaked this issue to the press in hopes of signaling to the players that they’re serious about a possible lock out.

That type of posturing, which may well be a bluff, can be dangerous for the progress of negotiations and may very well backfire on the owners. No one likes to be called to the carpet and made to look bad and that could be exactly what the owners are doing here or, worse yet, exactly how they’re making the players feel.

If this really was just a leak and the two sides are diligently committed to working out an agreement, even if it means working over Thanksgiving, then this may all just be a bluster of speculation that, given the timing, ends in an agreement before the deadline. Only time will tell.

The other possibility is that the two sides really are far apart on the outstanding issues, so far that a warning needed to be sent to the fans that this is likely to end up in a lock out. If that’s the case, and I sure hope it’s not, this could get worse before it gets better.

If the two sides don’t come to an agreement than clubs will be limited in what they can and cannot do once the deadline passes. Here is what the clubs can’t do if there’s a lockout:

• Enter into new contracts with players
• Trade or assign player contracts
• Waive or claim players
• Terminate contracts
• Exercise options on player contracts
• Release players
• Exercise reserve rights on players
• Sign international players to major league or minor league contracts

Clearly, there’s still plenty of time to get a deal worked out and there aren’t that many issues that make me think there won’t be a deal in place by next week. As in any negotiation that’s coming down to the wire, both sides are going to have to give on some of the issues. Here’s hoping that’s what happens by next Thursday.