For major league baseball players, “service time manipulation” is a four-letter word — and a key area to address in negotiations for a new collective bargaining agreement. But why is it such a massive concern?
While the average major league salary was a little more than $4 million in 2021, that number was skewed by the top of the pyramid. The vast majority of players, after years of grinding through minor league salaries that last year could be as little as $4,800, made nowhere near that amount.
Until most players accumulate three seasons of major league service time, they make little more than the MLB minimum, which was $570,500 last year. For the most part, raises go to players who have accumulated enough service time to reach eligibility for arbitration — something that happens only after most players have spent at least three years in the big leagues — and free agency, which arrives after six full years.
Virtually every team employs strategies that suppress the big league service time — and ultimately the earnings — of major league-ready players. The Red Sox are no different.
The experience of Nick Pivetta helps explain why the MLB Players Association is focused on improving pay for players in the early years of their careers and finding ways of limiting the transactional shenanigans that slow the path of players to performance- and market-driven salaries.
When the Red Sox traded with the Phillies for Pivetta on Aug. 21, 2020, their injury- and trade-decimated rotation was on its way to the worst ERA (5.34) in franchise history. The Sox viewed Pivetta, who’d been optioned to Philadelphia’s alternate site after allowing 10 runs in 5⅔ innings in an unfamiliar bullpen role, as a starter who could help them escape their morass.
Despite his struggles, when the Sox acquired Pivetta, there was little question he represented a viable short- and long-term option than some of the starters and openers who’d flickered in and out of the 2020 rotation.
Yet that didn’t mean he would immediately be summoned to the big leagues.
The Sox debated whether it was worth calling up Pivetta immediately so he could start reestablishing himself as a big-league starter while building a relationship with pitching coach Dave Bush. Instead, they decided he was better served getting stretched out at their alternate site in Pawtucket.
Once that decision was reached, there was little question that the team would wait at least a month before calling him up. While the Sox churned through starts by Zack Godley, Andrew Triggs, Mike Kickham, and Robinson Leyer — all of whom would be released within days of the end of the season — they waited until the final week of the season before summoning Pivetta for two starts.
Why? A full big league season of service time is defined as 172 days on the active major league roster. The Sox’ decision to wait to call up Pivetta, a 2013 fourth-rounder who made his big league debut in 2017, meant that he finished 2020 with two years and 166 days of big league service time. He was six days short of getting to three full years, the threshold that would have made him arbitration-eligible after 2020 and free agent-eligible after 2023.
Pivetta, who turned 29 last Monday, has spent sizable parts of the last five years in the big leagues. He’s made something close to the major league minimum when in the big leagues over that time, while making a fraction of the big league minimum when optioned to the minors. His earnings were further reduced thanks to the truncated COVID-19 season.
The result? Pivetta received a salary of $613,500 from the Sox last year as a pre-arbitration-eligible player, bringing his career earnings (big leagues and minors) to roughly $2.2 million in the five years since he was added to the 40-man roster following the 2016 season.
Such income is significant relative to the general population. That said, it’s dramatically short of what Pivetta would have commanded on the open market. Fangraphs calculates his career performance, based on the value of a win above replacement, has been worth more than $50 million to the Phillies and Red Sox.
It’s also meaningfully below what it could have been had the Sox called him up just one start earlier in 2020. In such a scenario, Pivetta would have been arbitration-eligible entering this year. Even with a poor performance in 2020, industry sources project he would have received a salary of more than $1 million in 2021, or at least $400,000 more than he made.
After his career-best 2021 for the Red Sox (9-8, 4.53 ERA in 155 innings with 9.7 strikeouts per nine innings), Pivetta will see a nice bump in 2022 when he finally gets his first whack at arbitration whenever the lockout ends. MLBTradeRumors.com projects that he’ll get $3.2 million.
Yet that’s hundreds of thousands of dollars less than he would have made as a second-time arbitration-eligible player with more than four years of service time. His arbitration case will likewise be different in 2023. The timing of his summons to the Red Sox likely decreased his earnings by $1 million to $2 million from 2021-23.
Additionally, the delay to Pivetta’s call-up means the Sox have the rights to his services through the 2024 season. A slightly earlier call-up in 2020 would have meant that he’d have reached the open market after 2023, following his 11th year in professional baseball. Instead, he’s on track to become eligible for free agency after the 2024 season. .
Age matters to a player’s market. In the last two offseasons, there have been just four multiyear contracts given to free agents who were entering their age-32 seasons or older, with Max Scherzer, Anthony DeSclafani, Mike Minor, and Alex Cobb getting the only multiyear deals in that age bracket.
The Sox aren’t alone in keeping a player in the minors in order to delay his eligibility for arbitration and/or free agency. There are many prominent instances where teams kept talented players in the minors — players who were better than members of their big league roster — in order to ensure more years of control.
David Price, a force in the 2008 playoffs for the Rays, was sent to the minors for the first two months of 2009 in order to delay his free agency by a year. The Astros offered George Springer a long-term deal before the start of the 2014 season; when he declined it, they sent him to the minors for two weeks to open the year. Houston likewise waited until June 2015 to call up Carlos Correa. Most famously, the Cubs kept Kris Bryant in the minors for a week and half at the start of the 2015 season.
Teams operated within the agreed-upon rules between MLB and the Players Association. But in some ways, that lies at the crux of why players want to see change in a new CBA.
The way teams operate within the rules has contributed to the dissatisfaction with the current system and mistrust by the Players Association with the way teams conduct business. The three- and six-year big league milestones have become more difficult to achieve, meaning less earnings for the majority of players.
According to one industry source, the average service time of players on Opening Day major league rosters in 2021 was roughly 4⅓ seasons, down from roughly 4⅔ seasons in 2011 and more than five seasons in 2006.
Careers are getting shorter, meaning time to earn substantially more than the big league minimum is shrinking. The Associated Press identified the median salary of big leaguers on Opening Day rosters last year as $1.15 million, 30 percent below 2015 levels.
The Players Association has proposed multiple mechanisms to address the development, including arbitration eligibility for 80 percent of players who have between two and three years of service time; a significant bump to the big league minimum ($775,000); and a $115 million bonus pool for players not yet eligible for arbitration. MLB has stated its unwillingness to consider earlier arbitration while offering lesser raises to the minimum with two proposals, one starting at $615,000 and increasing for players with one and two full years of service time, the other a flat $630,000 minimum; and a bonus pool to pre-arbitration-eligible players of $15 million. Both sides are also exchanging ideas about restricting the number of times a player can be optioned in a season.
Amid an owner-imposed lockout, negotiations on a new CBA are defined not just in the financial gap between those proposals but also in the mistrust formed by the practices that preceded them.