IRVING, Texas -- Major League Baseball's players and owners reached a tentative five-year Collective Bargaining Agreement through the 2021 season on Wednesday night. The parties will follow up today with a formal document, which then must be ratified by representatives of both sides. 
At 8:40 p.m. ET, an assortment of happy players, owners, lawyers and staffers poured from meeting rooms to exchange handshakes and hugs. That's how quickly 36 hours of round-the-clock negotiations ended, nearly four hours before today's deadline of 12:01 a.m. ET to reach a deal. Short of an agreement, the sport was faced with the best-case scenario of an extension or owners could have imposed a lockout.
MLB and Players Association agree to new labor deal
Players and owners negotiated until 5:30 a.m. Wednesday, took a few hours off, then went back to the bargaining table. Suddenly, negotiations that had moved with a crawl for months picked up intensity as the end of the current agreement approached.
Now, both parties are expected to speak at a news conference when the deal is formally announced.
Baseball has enjoyed 21 years of labor peace, during which time the sport has had astronomical growth in attendance, revenues and competitive balance. The new agreement means there will be no work stoppage for more than a quarter of a century.
The immediate impact is that free-agent negotiations and trade talks continue without any specter of interruption.
Most of the changes were regarding issues that had been discussed for weeks, but one surprising twist is that home-field advantage in the World Series will no longer be tied to the All-Star Game, as first reported by The Associated Press. Instead, the pennant winner with the better regular-season record will get home-field advantage in the Fall Classic.
In the end, this new agreement looks a lot like the one that was set to expire. However, there are changes to the luxury-tax threshold, international bonus pools and Draft-pick compensation, among other things.
Here's a breakdown based on unofficial word, and details will be clarified when terms of the agreement are announced:
Free-agent compensation Specifics on Draft-pick compensation are still being discussed. That said, qualifying offers -- which will still be calculated based on the average of the top 125 salaries -- can still be extended to free agents, but no more than once per player in his career. A player must still be on his club for the entire season to receive a qualifying offer.
Teams losing a free agent who received a qualifying offer will get a Draft pick only if the player signs a contract worth at least $50 million. After that, the pick depends on a team's market size, according to MLB Network Insider Ken Rosenthal.
Beginning in the 2017-18 offseason, teams will not lose first-round Draft picks for signing a premier free agent. However, teams exceeding the luxury-tax threshold would lose a second-rounder, fifth-rounder and $1 million in international pool money.
If a club hasn't exceeded the luxury-tax threshold, it will lose a third-round pick.
Luxury tax threshold Incremental increases from the current $189 million of 2014-16 to:
2017: $195 million 2018: $197 million 2019: $206 million 2020: $209 million 2021: $210 million
Tax rates for teams exceeding the threshold will rise from 17.5 percent to 20 percent for first-time instances, remain at 30 percent for second instances and increase from 40 to 50 percent for third-time instances.
There's a new 12 percent surtax for teams $20 million to $40 million above the threshold, 40 percent for first instances more than $40 million above the threshold and 42.5 percent for teams $40 million above the threshold a second time, according to The Associated Press.
International Draft Rather than an international Draft, which owners had sought, the two sides agreed to a bonus pool system, with a hard cap on how much each team can spend. That pool is expected to be $5 million to $6 million per team. Under the previous CBA, the bonus pools were scaled based on record the previous year, with the worst teams getting a little more than $5 million and the club with the best record getting a bonus pool in the $2 million range. It was also a "soft" cap, meaning teams could exceed it, but had to pay penalties for doing so.
Cuban-born players who are at least 25 years old, with six-plus years of experience in Serie Nacional, will maintain exemption from the international bonus pool, according to's Jon Paul Morosi.
Roster size No change. Teams will have 25-man rosters for the regular season, expanding to 40 in September. An expansion to 26-man rosters for April through August had been discussed in exchange for a smaller roster expansion in September, but that did not materialize.
Other items of note
• Beginning in 2018, the regular season will begin in mid-week to create additional off-days during the schedule.
• According to the New York Post, incoming Major Leaguers will be banned from using smokeless tobacco, but current players will be "grandfathered in" and still be permitted.
Richard Justice/

Comments are closed.