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Archive for Wednesday, October 25, 2006

Baseball reveals new labor deal

Collective bargaining agreement to run through 2011

October 25, 2006

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— Baseball players and owners proclaimed an unprecedented era of labor peace, finalizing a new five-year collective bargaining agreement Tuesday night before Game 3 of the World Series.

Lawyers struck the deal last weekend during negotiations in New York, then worked on putting it in writing. The agreement, which runs through the 2011 season, is subject to ratification by both sides.

The deal makes relatively minor changes to the previous agreement, and doesn't alter baseball's drug rules.

"This is the golden era in every way," said commissioner Bud Selig, sitting in the middle of a dais at Busch Stadium that included five officials from each side.

"The economics of our sport have improved dramatically, and that's good. That, after all, made for a more wholesome atmosphere. We didn't have to quarrel about a lot of things. So overall, it was a very, very important part of the environment that continues peace," he said.

The current contract, reached in August 2002, was set to expire Dec. 19. After eight work stoppages between 1972 and 1995, baseball will be assured of 16 years of labor peace.

The deal continues, with minor modifications, existing luxury tax and revenue-sharing rules, provisions that funneled money from large-market teams to their competitors. The payroll threshold for the luxury tax increases from $136.5 million this year to $148 million next year, then goes up each year until it reaches $178 million in 2011.

Under the current contract, the luxury tax has mainly affected the New York Yankees, who paid $11.8 million in 2003, $30 million in 2004 and $34.1 million in 2005. Boston paid $3.1 million in 2004 and $4.2 million last year, and the Angels paid about $900,000 in 2004.

The minimum salary increases, from $327,000 this year to $380,000 next season, and amateur draft pick compensation for some free agents who sign with new teams will be eliminated. Players selected in the June amateur draft who aren't college seniors must sign by Aug. 15, taking away the leverage of any threats to remain in school.

In addition, the Dec. 7 and Jan. 8 deadlines for free agents to re-sign with their former teams were eliminated, and management agreed there would be no contraction under the term of the agreement.

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