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NEW YORK -- Major League Baseball and the MLB Players Association entered an enhanced period of cooperation on Tuesday with the signing of a memorandum of understanding on a new five-year Basic Agreement, ensuring 21 years of labor peace for the sport.
The deal will last through Dec. 1, 2016, and includes mandatory testing of blood for human growth hormone for the first time at the Major League level beginning in Spring Training; 15 teams in each league by the 2013 season; another layer of playoffs and two more Wild Card teams as early as this coming season; changes in the First-Year Player Draft that could lead to a worldwide Draft by 2014; and expansion of the use of instant replay.
The new agreement now needs to be formalized in writing and ratified independently by the players and owners.
"That process will begin today," Commissioner Bud Selig said on Tuesday during a news conference to announce the new pact at MLB's central offices on Park Avenue in Manhattan. "There's still a lot of work to be done."
But nearly 11 months of the heaviest lifting is over as labor negotiators for both sides can take a deep breath and enjoy Thursday's Thanksgiving holiday and some down time with their families after weeks of long sessions.
This could be the last season of collective bargaining for Selig, who has said he will retire when his current contract expires at the end of 2012. If he does, he will have overseen three consecutive labor negotiations -- 2002, '06 and '11 -- without a strike or lockout. Baseball has not suffered a work stoppage since 1994-95.
"I believe that this new five-year agreement will continue the remarkable surge in popularity that baseball has enjoyed," Selig said. "I've said this before, and I will say it again today: Nobody back in the '70s, the '80s and the '90s -- especially '94 -- would ever have believed that we'd have 21 years of labor peace. It's really remarkable and clearly it's the longest period of labor peace that this sport has enjoyed.
"It's interesting to note that baseball's popularity, which has manifested in a myriad of ways, has been at its greatest in the last 15 or 16 years. One of the primary reasons, if not the primary reason, has been because of labor peace."
Tuesday's news conference capped a week full of positive announcements for Selig, who has overseen numerous changes to baseball since taking over as interim Commissioner in 1992. Under his watch MLB introduced the Wild Card, the first-round Division Series and Interleague Play. Gross revenues for the sport rose from $1 billion the year he took office to a record figure of more than $7 billion this year.
This past Thursday, at their final joint quarterly meeting of the year, the owners approved the transfer of the Houston Astros from outgoing owner Drayton McLane to a group headed by Houston businessman Jim Crane. With that, Selig announced that the Astros would move from the National League Central to the American League West in 2013 and that two more Wild Card teams will be added to the playoff mix as early as next season. The Wild Card teams in each league would most likely face each other in a one-game playoff to advance to the Division Series. MLB now has until March 1 to determine whether the playoffs will be expanded for the coming season.
The negotiation process for the new deal, which started in January, marked a seamless and successful initial go-round at the bargaining table between lead negotiator Rob Manfred -- MLB's executive vice president of labor relations and human resources, who represented the owners -- and the players, represented for the first time by executive director Michael Weiner, who took over that position from Don Fehr nearly two years ago.
It was in stark contrast to the labor wars, which resulted in eight consecutive work stoppages, beginning in 1972 and ending with the strike that shortened the 1994 season, wiping out that postseason and delaying the start of the '95 season.
In August 2002, the clock came down to a noon deadline before a deal was reached while players were seated on buses and about to again go out on strike. Instead, those buses rolled to the ballparks and an era of goodwill and cooperation began.
In 2006, the last negotiations led by Fehr were conducted quietly and behind the scenes, resulting in the agreement that was to expire on Dec. 11. These just-concluded negotiations were meticulous and led to the updating and rewriting of almost every clause in the Basic Agreement. Weiner called it "a good day for baseball and a good day for collective bargaining."
"I think what we've seen is a complete change in tone from the owners," Weiner said after the news conference. "In 2002, as you know, we came as close to a work stoppage as you can get without actually having [one]. I think that proved to both sides that maybe there was another way to do this. And now we've built on that two times in a row."
Highlights of the new CBA include:
Blood testing for HGH with a 50-game suspension for a first failed test, 100 games for a second and lifetime ban with the right to seek reinstatement for the third.
A raise in the minimum salary from $414,000 this year to $480,000 in 2012, and ultimately to more than $500,000.
A luxury tax on teams that spend above an aggregate figure for players signed through the annual First-Year Player Draft and the near elimination of Draft-pick compensation for the signing of free agents.
Subject to MLB discussions with the umpires' union, the expansion of instant replay to include fair and foul calls on balls hit down the line in addition to others trapped by fielders. Replay has been used only to review home runs -- fair or foul, in or out of the park.
Restrictions for the first time on the use of smokeless tobacco on the field or in dugouts. Players are still allowed to chew, but while they're in an area where they can be picked up by a television camera, the protocol now is for them not to have pouches or tins of tobacco visible in their uniform back pockets.
As far as blood testing for HGH, both sides said that they are confident that the tests are now certain enough to be able to utilize them. MLB and the union have spent considerable money since survey testing began at the big league level for performance-enhancing drugs during the 2003 season. HGH has been banned since 2005, but until now, there has been no way to reliably test for it.
"If the tests weren't reliable," Manfred said, "I don't think that either side would have agreed to do it."
The competitive-balance tax is back to balance big market teams spending large amounts of cash on player payroll. In the new deal, the threshold of $178 million this past season will hold steady for 2012-13, then increase to $189 million for the final three years. The tax will decrease to 17.5 percent of the actual dollars spent for clubs exceeding the threshold for the first time, but the repeaters tax will increase to 50 percent of that same figure for clubs that have done it at least four consecutive times.
There will be no dispensation in this deal for the Yankees, who have been over the threshold every year. Their past spending pattern will carry over into the new agreement.
Both the Wild Card expansion and realignment were resolved in collective bargaining because they involved scheduling. It will be the first change in the postseason since the Wild Cards were added and MLB went to a three-division format in both leagues in 1994. It will be the first realignment since the Brewers moved from the AL to the NL in 1998, ushering in the era of Interleague Play.