Part 22 of our series on Important Moments in Team Building. See introduction, and up-to-date list.
Since the Messersmith Decision in 1975, the negotiations for nearly every CBA have involved the owners trying to reverse the rights the players had gained. The most divisive negotiations, and all of the labor stoppages, have come when the owners are the most determined.
In 1976, the owners wanted to restrict free agency to players with nine years of service, before settling for six. In 1980-81 the owners demanded player compensation for any signed free agent, eventually settling for the ill-fated compensation draft. In 1985 owners initially demanded that teams above a certain payroll level be unable to sign free agents – effectively a salary cap. They did get a major concession from the players: an increase in the service time required for salary arbitration from two years to three years.
In 1990 the owners, already embroiled in legal difficulty because of their illegal collusion, nonetheless claimed massive industry losses and demanded a salary cap (plus a salary floor) for each team, the end to arbitration, and a pay-for-performance scheme for pre-free agency players. This went so poorly that Commissioner Fay Vincent basically took the players side. Despite a spring training lockout, the owners got none of what they wanted. Instead, they fired Vincent.
In 1994 the owners had no commissioner and the small market teams (led by “acting” commissioner Selig) had gained power and were ready to shut the game down to revamp their relationship with the players. The owners demanded a salary cap, revenue sharing, and an elimination of salary arbitration. They announced that they would impose this system after the 1994 season, which caused the players to strike on August 12. This ended the season.
The owners ultimately did impose their plan, and, with the union still on strike, opened spring training with replacement players. In March an NRLB decision enjoined the owners from implementing their plan, essentially restoring the old system. The players went back to work.
In what is now largely forgotten, even after the players returned to work the two sides butted heads for almost two more years before finally signing a new CBA. The owners and the players were so disgusted with each other that they all took several months off, not really bargaining again until after the 1995 season.
The union, led by their leader Don Fehr, and the owners’ chief negotiator, Randy Levine, finally reached an agreement in October 1996, essentially creating the model we have today, with a luxury tax and revenue sharing. The hardline owners still were unsatisfied without a true salary cap, and they had enough power to kill the agreement – needing 23 “yes” votes from the 30 owners, it could only garner 12. The players had no interest in renegotiating the pact, and talks again deadlocked.
At this point, November 1996, there was real risk that there could be another labor stoppage. What’s more, even with a signed agreement there was genuine doubt as to how “free” the free market might be. The owners were angry with the players union, and angry with each other. Salaries had been stagnant during the turmoil of the past few years. What was going to happen now – with frustration and anger at its height, and no CBA for two full years – was anyone’s guess.
What happened was a thunderbolt.
On November 19, the Chicago White Sox signed free agent (formerly Indians) outfielder Albert Belle to a record five-year, $52.5 million contract. Belle was an outstanding hitter (though a lesser player than Ken Griffey Jr., Barry Bonds and a few others) and a bit of a headache off the field.
The shock of the deal was not only the size of the contract – baseball had had many “record breaking” contracts over the past 20 years – but the team that signed him. White Sox owner Jerry Reinsdorf had been one of the hardline owners throughout the strike and against the recently negotiated deal, Selig’s chief ally, and the one of the most vocal of the diehards. If Jerry Reinsdorf was willing to give Albert Belle $52 million, taking him away from the small market Indians, their chief rival in the AL Central, what was the point of the labor impasse?
”We’re not being fiscally irresponsible because we can afford it,” said Reinsdorf, responding to criticism from the Indians. Reinsdorf was still not willing to give up his crusade to change the system, feebly adding: ”But it does bother me that there are only a few teams that can afford to do this. That means the game is not healthy. I want the people in Pittsburgh, Kansas City and Milwaukee and all the other small towns to have a chance to compete. I want competitive balance.”
Feeling their leader had moved on without them, the hardliners caved. A week or so later the owners ratified the Fehr-Levine pact by a vote of 26 to 4. The core of the old system — salary arbitration, free agency after six years – remained unchanged. The luxury tax and revenue sharing were new, but have stuck around, with occasional tweaks, through four subsequent CBAs.
With the new agreement finally in place, the owners were again willing to aggressively use free agency to reshape their teams. The Florida Marlins, led by their own hardline owner, Wayne Huizenga, gave out huge deals to Moises Alou, Bobby Bonilla, and Alex Fernandez, capping what turned into a huge off-season for players. The Blue Jays hoped to return to their pre-strike glory by signing Roger Clemens to a three-year $24.75 million contract, while the Yankees solidified their pitching staff by landing David Wells for a three-year $13.5 million contract. The salary malaise of the past few years had come to and end and salaries returned to their unrelenting upward trajectory. Free agency still offered the best opportunity to land mid-career stars, transforming or shoring up a team on the fly.