The KC Royals may or may not play baseball in 2020. The clubs and players haven’t agreed on pay issues. Can they get closer this weekend?
Writing about baseball’s labor standoff is risky. Unlike most of the KC Royals stories we give you, the dispute between MLB and the players is ever fluid and subject to sudden change. So news and analysis pieces, fresh when written, may stale soon after they appear here.
This complicates our normal writing routine. This story, for example, which you’re probably reading Sunday, wasn’t submitted until Saturday night, just in case the urgency of the situation compelled the clubs or the union to make some positive overture to the other this weekend. Labor talks have a way of un-stalling when the parties’ finances worsen with each passing day — especially when, as now, the window of opportunity for getting a deal done is closing.
But we can’t indefinitely delay writing about the dispute just because “something” might happen. These are critical baseball times — the clubs, including the KC Royals, are losing income every day; so are the players, whose livelihoods depend on a game they aren’t playing.
No one can plausibly argue the clubs aren’t losing revenues and won’t lose more. Two months of the season are lost, two months’ worth of game-dependent income gone. The losses grow bigger every day games aren’t played.
Similarly, no one can argue the players aren’t losing money and won’t lose more. Normally, they get paid only during a season, but the union agreed to accept $170 million from MLB if no games are played; the players will divide that money as they see fit, and it’s all they get if there isn’t a season. If games are played, they’ll be paid differently, possibly on the pro-rata basis pursuant to the agreement the parties reached in March but the clubs now argue was subject to further talks if games were to be played with no spectators in the stands, which is, at least for now, a certainty.
Last week, rumors ran rampant that MLB was preparing a proposal to split game revenues with the players, an offer destined for instant rejection because it smacked of the revenue sharing players disdain and the salary cap they abhor. But the clubs instead proposed pay based on a pro-rata/sliding scale hybrid that would have reduced high salaries more than low salaries and resulted in some severe pay reductions.
The offer apparently also included an 82-game slate. The union rejected it and counteroffered pro-rata pay based on 114 games, expanded playoffs for two seasons and deferred pay if the 2020 postseason is canceled.
I wrote Wednesday about reports that MLB was expected to counter with pro-rata pay for a 50-game schedule. But the clubs decided no counteroffer was better.
Why did they do that? Because they can. The clubs’ offers and counteroffers are based on economic contentions that, in the light of lost money all around, have at least some colorable basis in fact and reason, so the union isn’t well-positioned to argue MLB has bargained in bad faith. (At least not yet).
More immediately impactful, however, is Commissioner Rob Manfred’s power to unilaterally establish and impose a 2020 schedule. Wielding this hammer is tantamount to calling the players back to work; an economics-based union decision not to return would be a strike, something fans won’t suffer easily or well. Strikes are the most powerful economic weapon in labor’s arsenal but come with a heavy price — employees don’t get paid when they’re on strike.
Will Manfred drop his hammer? Certainly… if the owners tell him to. He is, after all, their employee. What they say is what he’ll do, so the question is this: To salvage something of a season and project a fan-friendly image, will the owners insist now on a 48-game schedule (a rumored number saturating Friday’s Internet) and order Manfred to implement it, or simply wait a few days or a week, then walk away and let the season end before it begins?
Simply put, MLB can cram the players down with no games or a pitifully short season. Either way, the players would realize fractions of their full salaries.
In a perfect world, owners would work for a campaign of meaningful length. But this isn’t a perfect world and the clubs, including the KC Royals, may fare better financially without any season at all. No season eliminates game-associated overhead, travel and lodging expenses and other heavy operating costs, and means the clubs will collectively pay players only that $170 million in “no season” money. Those savings won’t offset losses of game-generated revenue, but they’ll soften the blow.
So, owners must decide how much they’re willing to lose and balance that against the ugly optics of abandoning the season altogether and the consequential potential long-term damage to their business. In the end, they’ll put games on if they can extract more concessions from the players. But that requires compromise.
From all appearances, union chief Tony Clark can drive a hard bargain and says what’s necessary to galvanize his membership. He’s an accomplished former player who undoubtedly realizes he wouldn’t have made the money he did without the effective efforts of his union leader predecessors and their willingness to compromise when necessary.
Clark’s union can compromise if it wants to. It never expected owners to accept a 114-game schedule and probably believes the owners’ 50-game proposal is nothing more than a negotiating tactic. The union could back off 114 games and propose to play the 82 the clubs offered several days ago, a perfect splitting of the difference between 114 and 50 contests and a viable path toward more pay. It could put salary deferral back on the table. (Further pay concessions are inconceivable unless MLB offers something extraordinarily irresistible in return).
The owners can also compromise. They can step back from the 48-game rumors and their 50-game and hybrid pay plan proposals — they were rumored just days ago to be willing to concede pro-rata pay and it wasn’t that long ago they floated an 82-game season. Players know pro-rata pay for 82 games will be less than for 114, but more than for 48 or 50. Compared to the uncertainty of an undetermined slice of the $170 million “no games” pie, that’s money in the bank for each player. Some of whom, like so many others in these difficult times, need to get paid — and soon.
The clubs should also signal a willingness to accept the union’s two-year expanded playoffs offer; more games played increases the postseason cash bonanza clubs don’t have to share with players. That, too, is money in the bank. And a lot of it.
“Time is running out” has now achieved tired cliche status, but it’s an accurate assessment. June 10 is the date most frequently bandied about for a timely resumption of spring training; July 1, or thereabouts, is the popularly accepted notion of the ideal Opening Day.
That brings us to this weekend. I’ve negotiated deals, including labor and employment agreements, for over 30 years, and learned some important things. Economics drives everything; no one gets everything they want; everyone leaves at least a little on the table; compromise is the key. And weekends are funny things — I’m always amazed how weekends beget deals, especially when time is, as now, of the essence.
If things move in the right direction in what little is left of this weekend, we’ll see KC Royals baseball in 2020; if they don’t, it’s quite possible we won’t. Both sides have things to give, but they need to give them now. Maybe they’ll have done so by the time you read this. If so, I’ll be glad this story is old news.
Here’s hoping MLB and the MLBPA resolve their differences soon. We could all use some KC Royals baseball.