Major League Baseball Could Potentially Cancel Season
Published on June 2nd, 2020 1:52 am ESTWritten By: Dave Manuel
The NHL and NBA were pretty quick to reach workable deals with its respective Player Unions to return to action in 2020. While neither league is 100% going to return this year, things are looking good. The biggest points of contention were centered around playoff formats, Coronavirus testing and the protection of the health of the players.
Unless the Coronavirus bounces back this summer, both the NHL and NBA will return to action.
Major League Baseball, however, is still negotiating with the MLBPA (Major League Baseball Players Association), and there is a very real chance that the league doesn't return in 2020.
This would be disastrous for the league, and would potentially do more damage to the sport than the season cancellation of 1994.
So - why is Major League Baseball in such a perilous situation, while the NBA and NHL are going to be returning to action, likely in July?
The answer lies in the CBAs of all three leagues (collective bargaining agreement).
The NHL has a hard salary cap system, where the league and its players share in the league's revenues. There is an escrow system in place to make sure that the owners are made whole if league revenues come in a bit lighter than expected.
The NBA has a soft salary cap system. The league and its players share between 49-51% of the Basketball Related Income that the league generates. The NBA also uses an escrow system.
Major League Baseball, on the other hand, does not have a salary cap. In fact, it is the only one of the four major North American sports that doesn't have a salary cap system, and this may result in the cancellation of the league's season.
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The NBA and NHL essentially shares its revenues with its players. So, if the leagues take a big hit in revenues, all of the sides will suffer. The owners will take in less revenues, though the players will need to give up very big portions of their salaries to the owners in the form of retained escrow money. Neither side has a problem with this - the players in the NBA and NHL certainly aren't expecting to receive all of their money this season.
In addition, the NBA and NHL were well into their seasons when the Coronavirus hit.
Major League Baseball, on the other hand, doesn't have a salary cap system in place, so things are very messy.
The owners want to play a 50 game season this year, with players agreeing to take very large pay cuts. These cuts would work on a sliding scale, with the highest paid players taking the biggest cuts.
A player who is making $35 million a year, for instance, would receive just $7.84 million under the owner's proposal.
The players want a 114 game season that see players receive pro-rated salaries. Their proposal would include $100 million in salary advances before the second training camp would get underway, as well as giving "high risk" (for.contracting Coronavirus) the right to opt out of playing, while still receiving their salaries or earning "service time".
As you can see, the two sides are very far apart. While there is still time to negotiate, you'd have to think that the two sides will need to reach a deal by the end of June in order to salvage a season, as they'll need to complete work on the logistics, recall players, start training camps, etc.
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There is no mechanism for Major League Baseball to flip a switch and resume play.
How much will the players be paid? What if the owner's projected revenues fall much shorter of expectations?
Many baseball clubs have regional TV deals that pay them significant amounts of money. How will these contracts be impacted? What kinds of concessions will the clubs have to give? How will "years of service" be calculated in a shortened season?
There are so many moving parts with Major League Baseball that both the NBA and NHL don't have to worry about.
In the end, Major League Baseball's lack of a salary cap may end up costing them an entire season of baseball, which will end up painting both sides as extremely greedy.
