Arbitration for Dummies

With all the chatter surrounding Jonathan Papelbon and the potential for an arbitration hearing, I figured I would explain the process for those who are unfamiliar. The process is not extremely complicated, but has several deadlines and steps that sometimes get overlooked.

Who is Eligible for Arbitration?

There are three criteria for becoming eligible for arbitration.

1. The player must be ineligible for free agency.
2. The player must be without a contract.
3. The player must have been on a Major League roster for between 3 and 6 years.

There is one other category of players that can become eligible for arbitration and those are referred to as the Super 2. The Super 2 are players in their second year in the league that meet the criteria above (except for being in the league 3-6 years) and also satisfy the following 3 criteria.

1. The player must have at least 2 years, but less than 3 years experience in the majors.
2. The player must have played in the majors for at least 86 days in the previous season
3. The player must be among the top 17 percent of the league in cumulative playing time in the majors.

What are the Arbitration Deadlines for 2010?

Information courtesy of www.hotstove.com.

December 1, 2009 – Deadline for Teams to Offer Arbitration in Order to Receive Compensation
Teams must offer arbitration to eligible players by this date, in order to receive compensation (in the form of draft picks) if the player winds up signing elsewhere.

December 7, 2009 – Deadline for Free Agents to Accept Arbitration
Players who are offered arbitration by their current teams must accept the offer by this date, or will instead become free agents. If a player does accept arbitration, he has essentially entered into a contractual relationship with their current team.

January 5-15, 2010 – Arbitration Filing Period
Arbitration-eligible players will file during this 10-day period, during which teams will actively negotiate with those players in order to avoid arbitration.

February 1-21, 2010 – Arbitration Hearings
The (usually few) players who have still not agreed to contract terms with their teams will now engage in arbitration hearings. During these hearings, the player and his team will present a one-year contract salary, along with arguments to back up their demands, to a neutral third party. The arbitrator will then decide to either award the player his salary demand or the team’s salary offer (this type of decision is called a “high-low” proceeding).

What’s Next for Papelbon?

If the Papelbon and the Sox are unable to reach a contract agreement by noon today, the process moves to an arbitration hearing. The process proceeds as described above with hearings taking place during February. If this situation goes to an arbitration hearing, it would be the first time since Theo took over as GM in 2002 that the Sox had a player take them to a hearing. Stay tuned today for more breaking news regarding negotiations between Papelbon and the Sox.