NEW YORK – A week after Major League Baseball and the MLB Players Association exchanged initial proposals to begin collective bargaining talks in earnest, Commissioner Rob Manfred pushed back on the idea that the league’s proposal of a salary cap and floor would reduce player salaries right off the bat.
MLBPA interim executive director Bruce Meyer said this week that had the league’s proposal been in place in 2026, it would have cost players more than a half-billion dollars. Manfred vehemently disagreed with that assertion.
“Our initial proposal was specifically constructed to ensure that in the first year of the contract, Major League players would make more money than they made in 2026,” Manfred said during his press conference on Wednesday at the owners meetings. “To the extent that anybody is suggesting something other than that, it's just not accurate.”
The league’s initial proposal included a salary cap and floor, with no club permitted to exceed the cap and all clubs required to comply with the floor.
In 2027, the salary floor would be set at $171.2 million, requiring 12 teams to increase payroll by a combined $617 million to meet the floor. The proposed salary cap for 2027 would be $245.3 million, requiring eight clubs to reduce payroll by a combined $578 million.
Salary cap and floor figures would utilize CBT payrolls, which include benefit costs consistent with the current format (projected to be approximately $23 million per team in 2027).
The MLBPA has maintained repeatedly that it will not agree to a salary cap system as part of a new agreement, but Manfred noted that the bargaining process makes nearly every issue fluid.
“I'm a simple soul when it comes to collective bargaining,” Manfred said. “Everybody gets to make their own proposals. I think if I said, ‘I'm not interested in increasing the minimum salary no matter what,’ I doubt that the union would say, ‘OK, that's great; no minimum salary.’ It’s a process. We think we made a proposal that addresses probably the most significant business concern for us, and we think addressing that concern will have really significant upside for the owners and the players.”
MLB’s Competitive Balance Tax was designed to keep all 30 clubs on a level playing field, but Manfred acknowledged that it hasn’t had the desired impact since being installed nearly two decades ago.
Over the past decade, MLB’s regular season and postseason have been dominated by large-market teams, with nearly 80% of teams in the League Championship Series, 85% of teams in the World Series and 90% of teams to win a championship coming from a top-15 market.
Since 2012, only one team from a bottom-15 market has won a World Series (the 2015 Royals), while the NFL (5), NBA (7) and NHL (7) have all seen smaller-market teams win it all under salary cap systems.
“We have tried mightily over several rounds of bargaining to use a Competitive Balance Tax to address competitive concerns; sometimes you’ve got to admit you failed,” Manfred said. “If you look at the amount of tax that's been paid over time, we never thought about the CBT as a revenue-generating device. When you see more and more tax getting paid, you realize that it is not the kind of speed bump that would help on the issue of competitive balance.”
The proposed salary cap would be slightly higher than the current CBT threshold, which stands at $244 million.
“We want to make an agreement,” Manfred said. “We made a proposal on one set of topics at the outset of the negotiations. We're open to whatever ideas people have, but we need a realistic framework that addresses the fans' concerns about competitive balance. You just can't ignore that financial penalties have not gotten it done for us.”
There are no dates set for the next round of talks between MLB and the MLBPA, but having exchanged initial proposals, Manfred is eager to continue talks.
“Every deal that gets made has to achieve some of the things that we're looking to achieve and some of the things that the union is looking to achieve,” Manfred said. “There are proposals and there are goals behind proposals; we're looking at their proposals, trying to figure out what they're trying to achieve, and whether we can meet some of those goals and still achieve the things that we're looking at.”
The current collective bargaining agreement is set to expire on December 1.
“I think that the proposal we've made is grounds for constructive dialogue back and forth with the MLBPA about how we can address the number one concern of our fans, and that is a lack of competitive balance in the game,” Manfred said. “We're going to get back to the table, and I hope have productive conversations about the things that are out there already and complete the process. There are a lot of topics we haven't even started on yet. I'm anxious to get back in the room.”