Baseball Owners Propose Limits on Free Agent Salaries

Major league baseball club owners proposed on Monday as part of their contract offer a plan to limit salaries for free agents and other players who move from one team to another.

Their chief negotiator, Lee MacPhail, described the proposal “as a means of bringing order out of financial chaos.” But union chief Don Fehr said that at first glance it appeared to be “a step backward of the most enormous magnitude because it would do away with free agency in baseball as we know it.”

MacPhail said the payroll plan is “patterned after the NBA’s salary cap,” and called it the most significant proposal made thus far in the sporadic contract talks. He said it would not affect the salaries of players already on the 40-man rosters, but would limit what teams could spend on others subsequently acquired.

Two years ago, the National Basketball Assn. became the first major professional sports league with a salary cap. Players and owners agreed to limit each team to a given payroll each year--the figure for this season is $3.6 million for each team’s 12-player roster.

Monday’s plan was one of eight items in a proposal made by management.

It also offered to do away with the free agent re-entry draft, with which the players have grown disenchanted, and to eliminate professional players as compensation to teams which lose high-ranking free agents, a major issue in the 50-day strike in 1981.

“All we were trying to do was slow the dramatic increase in salaries,” MacPhail said of the payroll plan. “Our objective is by slowing that increase to allow baseball revenues to catch up with our costs and put baseball back somewhere in a break-even position where the clubs could stand financially on their own two feet.”

The owners, who have maintained during contract talks that the sport is having severe economic problems, last week gave the players’ assn. data which showed an aggregate loss last year of $36 million, with 24 teams reporting. MacPhail said that when the two remaining clubs report the figure could go as high as $42 million.

MacPhail, president of the owners’ Player Relations Committee, explained the plan by saying: “We would figure an average payroll for clubs based on 1985 player compensation. And the clubs’ own payroll in relation to average payroll level would determine what they could and could not do” in regard to signing other players.

“Generally speaking, there would be no limit on what the clubs can do with their own players, regardless of where they were with respect to the average player level.

“As far as players not on the 40-man roster, they (the clubs) would be able to go up only to the limit of the level,” MacPhail said.

MacPhail said when the plan went into effect, “clubs well above the level would be given a grace period--some time to get down--or they could stay where they are. There is no prohibition to remain above the average payroll level but there would be restrictions on what they could do about acquiring players not on their 40-man payroll.”

Fehr said the owners’ proposals did not contain “enough specifics to really come to grips with. But, for the first time, they’ve at least said something in bargaining. The problem is what they’ve said.”

He said his first impression was that, “it would functionally do away with the right of a baseball player to seek a market value level for his services.

“Their proposal would eliminate most clubs from the free agent market most of the time. The outline was specific enough to understand that clubs having a higher than average payroll wouldn’t be permited to sign free agents.”

Fehr said Monday’s proposals would be presented to the union’s executive committee at a meeting in Chicago Thursday where player representatives are expected to vote to request strike authorization from the players.

About management’s willingness to abolish the re-entry draft, Fehr said, “If you do away with the re-entry draft and say all players can negotiate with all clubs, that’s one thing. If you then say most clubs can’t sign any free agents, that makes the first rather meaningless.”

Fehr, the union’s acting executive director again was accompanied at negotiations by Marvin Miller, the retired executive director who directed the 1981 strike.

The club owners also proposed what MacPhail termed “major improvements” in retirement benefits for those still active and those already retired, an increase in the minimum salary to $60,000 from the present $40,000 and to take steps to protect the players with respect to the $250 million of unfinanced deferred compensation committed to be paid the players in the future.

Also, MacPhail said the owners would adopt player benefits in the form of an improved waiver system, increased allowances and an increased postseason player pool.