Salary arbitration in baseball is inherently boring. It's a technical process that amounts to two sides yelling over whether a player should get something like a 5% raise or a 7.5% raise. It takes up a lot of time for both agents and clubs, and the arbitrators are not baseball experts, so cases have to be argued with mostly just stats you'd find on the back of a baseball card rather than the deeper and more nuanced discussions you'd typically find in this space.
So when I was employed in a front office, I normally did everything I could to avoid working on arbitration cases, and as a writer, I essentially ignored the whole thing. But this year is different. I've already done rankings and assessments of every free agent and looked at what all 30 teams (AL and NL) should be doing this offseason. The next, hopefully last, big hurdle before the offseason really gets going is the Dec. 2 non-tender deadline. This is when clubs either release a player or agree to continue in the arbitration process with him.
Because league revenues and the free-agent market in general are down so much this year, arbitration salaries of solid players are closer than ever to free-agent prices, meaning that more players in their team-control years, which typically are heavily valued, instead will become free agents. And since we really don't know how down the market is, the tendering process will provide some clues. Some legitimately good players present tough decisions for their teams in a way they wouldn't have in a normal economic situation.
The process, briefly
The short explanation of the salary arbitration process is essentially this: For their first three years in the big leagues, the vast majority of players make the league minimum or slightly above, then for the next three years their salaries steadily get closer to market value via the arbitration process. They can hit free agency after their sixth full season, when they're free to get full market value. There are numerous exceptions and details beyond that, but that's the broad landscape.
During the arbitration process, both sides have months to work out a deal, but if they can't, the player's salary is determined in a hearing before an arbitration panel (although only a handful of cases per year get this far). For the hearing, each side argues why its proposed salary is appropriate, and the panel picks one or the other. The hearing, and thus the negotiations before it, are all based on counting stats and the salaries of comparable players. This can undervalue (relative to the market) advanced-stat darlings who excel at defense, baserunning and rate stats in smaller samples but don't rack up saves, wins or home runs. It also overvalues those who accumulate lots of those shiny stats. It's somewhat common for one-dimensional sluggers to get non-tendered after a 30-homer season or for clubs to try to avoid using a reliever in his arbitration years as their regular closer so as not to artificially inflate his salary the following season.
In the weeks leading up to an arbitration hearing, there's a "magic number" that both sides dance around in negotiations. Generally speaking, if that number is $5 million for a player, the sides slowly get closer to a deal throughout the winter, and if they end up filing for a hearing, the player would file at something like $5.5 million and the team around $4.5 million.
By tendering a player, the team commits to going through the arbitration process and the player is guaranteed some sort of deal, with the final fallback being a hearing. If a player who was tendered in the winter gets outrighted from the team during spring training, he would be owed one-sixth of the awarded salary, so only players with clear roles get tendered.
A player who is non-tendered immediately becomes a free agent, but the team has had months of exclusive negotiating rights with the player to that point, so often in these cases a deal already has been agreed upon that is finalized as the player becomes a free agent. A fringe player due to make about $1 million in arbitration is a candidate for a non-tender, non-guaranteed minor league deal with a $1.5 million salary if he makes the team, for example. This sort of deal saves the team a 40-man roster spot and guaranteed salary, while the player gets the potential for a bigger payday. It's a common move that will be more common this year.
The challenge of 2020
Complicating matters this winter is the fact that the 2020 season consisted of only 60 games, so raw counting stats won't match up with prior precedents. Would the arbitration panel lean toward using the 60 games extrapolated over 162 (so one homer in 2020 would be treated like 2.7 homers), or just the raw 60-game count with either no adjustment (cratering potential salary raises) or some other sort of adjustment? Neither side is sure how this will be handled this year, and both assume it will be somewhere in the middle. One thing that is known is found in the March agreement between the players and owners: "The parties agree that 2021 salaries as determined under this Section V cannot be used as precedent or evidence in any subsequent salary arbitration hearing."
There are a few ways to work around this. There's a "pre-tender," or a deal struck before Dec. 2, often a bit below a midpoint (i.e. true arbitration value) of where the sides stand, which would avoid a non-tender and the player becoming a free agent, maybe with some incentives added so the player could get to that midpoint with a good season. There should be a lot more of those this year than usual. They can muddy the waters for precedents in future years but aren't really used in hearings; same goes for multiyear deals.
It also happens every now and then that a player is non-tendered but ends up landing a higher salary on the open market. In this case, the club that non-tendered the player should have offered him in a trade or put him through waivers to get some value in return. This happened with the A's and Blake Treinen last winter.
That will likely happen more this year, and we've already seen something akin to it with Charlie Morton. He signed with the Braves last week for $15 million, about a month after the Rays declined his $15 million option. Many teams will see these option and tender decisions the same way if the terms match or come close to market value: Defer the decision and take on almost no short-term risk. This could also end up happening with Kolten Wong and Brad Hand on their declined options (for Wong, $12.5 million; for Hand, $10 million), and there are some non-tender candidates in the same situation. It could be that most teams value certain players the same in a vacuum but are in tough decisions with tighter payrolls and a big pool of free agents, meaning other clubs won't claim or trade for them but would kick the tires on signing them to similar terms in a few weeks.
Players of interest
With the stage set, I'll dive into a bunch of players to monitor both to glean signs about the market and for clues about how clubs will try to build their rosters the rest of the winter. I'll use ranges to represent what an arbitration award could be rather than one sort of projection, for all the reasons mentioned above.
3B Kris Bryant, Cubs
2021 Opening Day age: 29
2020 salary: $18.6 million
Projected 2021 arbitration salary: $18.5 million to $20 million
This is the big one the industry is paying close attention to. The Cubs are in a tough spot overall and with Bryant specifically. He wasn't very good last year and they manipulated his service time on the way up to get this extra year, which now has almost zero value. Bryant is in the area where he could get non-tendered. He could also sign a pre-tender deal with some incentives to save face, maybe sign a two-year deal (it's hard to imagine Bryant's agent, Scott Boras, doing anything longer after a down year) or he could be traded for a smallish return. Given the conditions of the market, short of a bidding war among potential trade partners, there seems to be little reason for teams to offer the Cubs anything of real value when they're the ones feeling the pressure to steer out of their current jam?
With the Cubs short on cash to spend but having many of their top players set to be free agents after the 2021 season, even keeping everyone for one more go-round may not be feasible, since that would limit what could be done to fill other holes, and new club president Jed Hoyer appears to be antsy to begin the next chapter in Chicago. The most proactive way to get there is to choose between Baez and Bryant, as he likely can't re-sign both next winter, but most in the industry assume since Bryant has little trade value, the Cubs will indeed just run it back one more time.
Now, you may take a quick gander at Bryant's FanGraphs page and see he's projected for a solid 3 WAR next year, which easily would be worth a one-year deal of roughly $20 million in the past, and wonder why this is even a question. Well, first look at this admittedly small and cherry-picked sample, and check out basically any number from 2020 you like here. Then go back to his FanGraphs page and look at his age and the general trajectory of every major stat.
Take his hard-hit percentage:
Clubs won't be excited to pay an AAV that hasn't been met in the free-agent market yet this winter for a player who could be more sizzle than steak, particularly when there are so many free-agent alternatives still on the market. This is almost a worst-case scenario for both Bryant and the Cubs, something that was almost inconceivable pre-COVID-19.
As for landing spots, the Braves make sense -- having Bryant on a one-year deal, moving Austin Riley to the outfield to take the place of potential non-tender Adam Duvall, with Cristian Pache and Drew Waters taking the outfield by 2022 -- but I've been told that's quite unlikely. The Nationals have a number of Boras clients and seem willing to explore Bryant, but it's unclear what they'd be willing to give in a trade. Any team that could use more thump on the corners that looks like it has some money to spend -- the Jays, White Sox, Giants, Mets and Dodgers all fit that description as well -- makes sense, to some degree. That lands us in the situation where the Cubs face a tender/non-tender decision because the optics of trading Bryant for marginal prospects at the nadir of his value, just before a last season with this championship group intact, are quite bad.
Lastly, Bryant's free-agent value is probably in the $15 million-$20 million area, with more incentives at the lower end of that range and almost certainly on a one-year deal. Boras can't get a big multiyear offer right now and won't want to delay the potential free-agent payday too long, hoping Bryant can bounce back and hit the market next winter at his prior nine-figure form, with league revenues also having rebounded. Maybe both of those happening in the next 12 months is far-fetched, but Boras thinks almost exclusively about precedent-setting situations. Representing Corey Seager and Bryant next winter keeps Boras in the middle of the battle, as the players' union continues its fight for a collective bargaining agreement to replace the one that expires Dec. 1, 2021.
LF Eddie Rosario, Twins
2021 Opening Day age: 29
2020 salary: $7.75 million
Projected 2021 arbitration salary: $8.5 million-$12.0 million
Rosario fits the type mentioned above, the counting-stat-friendly, one-dimensional slugger. He's good for 25 to 30 homers next year with below-average defense in left field. Because he's not a 1B/DH-only fit, he wouldn't be a slam-dunk non-tender like the Chris Carter types of the past, but the market adjustment has put Rosario into 50/50 territory.
Michael Brantley is four years older than Rosario and a little more fragile, with a little less defensive value, but is essentially the same player. I projected Brantley to get one year and $10 million on this market, which is basically the midpoint of my arb projection for Rosario. If the Twins want to keep Rosario, this price is fine to bring him back. If they aren't sure where Rosario fits -- if they want to put top prospect Alex Kirilloff and already-extended Max Kepler at the corners, bring back Nelson Cruz to DH and spend the Rosario savings on a starting pitcher -- they easily could non-tender him. Rosario was going to become a free agent after 2021 anyway, so this just moves that plan up a year.
LH SP Matthew Boyd, Tigers
2021 Opening Day age: 30
2020 salary: $5.3 million
Projected 2021 arbitration salary: $5.5 million-$7.9 million
LF Adam Duvall, Braves
2021 Opening Day age: 32
2020 salary: $3.25 million
Projected 2021 arbitration salary: $4.2 million-$6.8 million
I'm grouping these two together since they both come with an extra year of club control after 2021. That provides a little more incentive for their teams to tender them if they think the players will improve in 2021, giving them another sub-open-market price for 2022. This also would make them slightly more attractive free agents if they get non-tendered and sign one-year deals, giving their new team a no-buyout club option of sorts.
Boyd was one of the hottest trade commodities on the market at the 2019 trade deadline, but his trade value all but evaporated within about a year, following the pattern set by teammate Michael Fulmer in 2017. Boyd's home run problem kept getting worse, while his strike-zone control regressed, and he's now 30. He's in the range of free agents such as Tyler Chatwood and Mike Leake, who project to sign one-year deals in the range of Boyd's projected arb deal. Like Rosario, the number is about his market value, and since Boyd is a bounce-back candidate and possible trade asset, he should be tendered.
Duvall had a solid year, but Statcast's xwOBA figure suggests he's been a bit lucky with results in 2019 and 2020, while his defense has regressed to about average. If you buy both of these underlying indicators going forward, he's more a good platoon bat than a low-end starter, and his market value is more like his 2019 salary, or a bit below the midpoint of my projections, making him a candidate for a pre-tender deal with incentives since the Braves need a player like Duvall in 2021 to bridge to Pache and Waters.
The other big names
C Gary Sanchez, Yankees
C Willson Contreras, Cubs
1B Josh Bell, Pirates
3B Maikel Franco, Royals
OF Tommy Pham, Padres
OF Kyle Schwarber, Cubs
OF Jorge Soler, Royals
SP Jon Gray, Rockies
The members of this group project to land in the $5 million-$9 million range in arbitration and are all likely to be tendered, but many of them are probably more available for trade than they would have been pre-COVID-19 due to their upcoming free agency (post-2022 for Sanchez, Contreras and Bell; post-2021 for the others) and near-market arbitration salaries. I also wouldn't be surprised if any of these players were non-tendered, but I wouldn't call any of them more than 35% likely to be cut loose.
A sneaky non-tender candidate among this group is Bell, who had an atrocious 2020, with underlying metrics that indicate he wasn't unlucky. Third baseman Ke'Bryan Hayes now seems like the cornerstone of the Pirates' rebuild after just 24 big league games, in part because Bell and Bryan Reynolds took nosedives in 2020. But tendering Bell and guaranteeing him $5 million-$7 million with another year of arb control after 2021 is a fine upside bet for a rebuilding club that isn't spending much on payroll and is looking to bolster its talent base.
That said, if you strip away the name and adjust expectations a bit south due to 2020, Bell could be seen as a one-dimensional slugger coming off a sub-replacement-level season. Compare that to Marlins first baseman Jesus Aguilar, a former waiver-wire find who has the same amount of service time, projects for a couple of million less via arbitration in 2021 and is coming off a solid 2020. This shows how arbitration overpays players with better timing, more history and better counting stats, along with how fickle the value of first basemen can be.
$3-6M non-tender candidates
RH SP Zach Davies, Padres
RF Nomar Mazara, White Sox
RH RP Hector Neris, Phillies
RH RP Corey Knebel, Brewers
LH SP Steven Matz, Mets
3B Travis Shaw, Blue Jays
RH RP Matt Barnes, Red Sox
LH SP Carlos Rodon, White Sox
RH RP Jose Urena, Marlins
RH RP Hansel Robles, Angels
UT Danny Santana, Rangers
OF Brian Goodwin, Reds
There are a ton of players projected for $2 million or less, but there's always a good bit of action in that area of the non-tender world among what amounts to fringe big leaguers. I've focused above that, at those projected for the $3 million-$6 million range, and listed them in order of projected arb price, with Davies (projection: $6.5 million-$9.5 million) the one exception above that level because he's not well-known enough to go in the previous section. Ureña, the Marlins' Opening Day starter in 2018 and 2019, was designated for assignment by Miami on Monday.
Some of these guys, such as Goodwin or Mazara, look very likely to be non-tendered, but that probability increases the odds of a cut-rate pre-tender, so I wouldn't bet much on any one player having a specific procedural move happen to them. Teams probably won't want to tender these players at the arbitration price, so they'll either cut them loose (don't have payroll room or don't believe in the player), try to cut a deal soon (both sides want to have a reunion, understand the market reality) or play chicken (the sides don't agree on market realities, or the player knows he has a landing spot elsewhere for near his arb price if non-tendered). If you thought this whole article was a bit in the weeds, imagine how much worse it would have been last winter. And imagine how much I don't want to have to write one like it next winter.