Minor League Clubs Pushing Back on MLB’s Blanket Franchise Agreement

Barry M. Bloom
·7 min read

Major League Baseball and some of its 120 chosen minor league affiliates may be heading toward confrontation over a pending new franchise agreement called a Player Development License (PDL) that each club must sign by Friday.

There’s a movement among a majority of the affiliates to refrain from signing, thus forcing negotiations with MLB, which is trying to dictate what some are calling “onerous terms in the one-sided agreement.” Sportico has not seen the agreement but has had key clauses relayed by phone.

“There’s a lot of discussion about this within the leagues,” said an MiLB source with knowledge of the situation who asked to remain anonymous for fear of reprisal from MLB. “It comes down as heavy-handed: ‘Here are the terms.’ Some clubs don’t want to sign this without even a discussion. That’s what some people are upset about.”

The chief point of contention is the PDL’s opening clause, a six-page release of liability called the “Confidentiality, Non-Disclosure, and Release Agreement” that must be signed before the rest of the 60 pages is even contemplated. But when that portion of the agreement is signed, it essentially locks a franchise owner into the entire vehicle.

In theory, a single resistor could be replaced by another market, depending upon territorial rights at the big-league level and the availability of facilities, another source with knowledge of the negotiations said. For example, because of New York territorial rights owned by the Mets and Yankees, it would be improbable to place a team affiliated with another big-league organization in the now-vacated Staten Island ballpark. Staten Island lost its short-season Single-A affiliation under the proposed new setup, and the franchise owner is now suing the New York Yankees and MLB.

But in practice, the more teams that don’t sign, the less ability MLB will have to replace them.

“There’s not a lot of [available] markets out there,” one of the sources said.

It should be added that though MLB has officially encroached on the MiLB, an overall minor-league umbrella agreement was in the process of being negotiated, although the 120 individual agreements are now intended to replacing it.

Franchise owners are also highly concerned that a 2021 season schedule has not been established. There’s no guarantee right now MiLB will even be played, leading to the possibility of a second consecutive cancelled season because of the ongoing strains presented by the spreading coronavirus complicated by this dramatic reorganization.

Without a schedule, or even a start date, there’s nothing for the franchises to market to ticket-buying fans at the moment. And unlike the past, MLB is stipulating that the schedule for 2021 will be created out of the central office in New York, rather than at the minor league level, where owners and officials are aware of the regional nuances presented by fans and communities.

A source with knowledge of the negotiations said schedules would be released as soon as the 120 franchise owners sign their PDLs.

There has also been a dissolution of the individual league offices and the proposed elimination of presidents, which means on-field disciplinary decisions at all MiLB levels would be administered by a bare-bones staff out of New York.

“The pandemic made it so we can’t miss the season,” one anonymous MiLB owner said. “Not to have revenue for two consecutive seasons with the potential of a 2022 Major League work stoppage would wipe out everybody. So, the pandemic definitely hurt our negotiating position. But we had a weakened one anyway.”

Peter Woodfork, whom MLB appointed last month as senior vice president of minor league operations and development, declined to comment when reached by phone this week, referring all queries to MLB public relations.

In another major concern, each franchise has also been told it must purchase a $25 million insurance policy to avoid liability regarding alcohol consumption at the ballpark. That’s more than four times the amount of liquor liability each club had to purchase in the past and is way too costly to insure at the minor-league level, the MiLB source said.

MLB’s new agreement would lock each minor league team into a blanket 10-year term with its big-league club, as opposed to the old short-term agreements signed directly between affiliates and their MLB clubs. The PDL does include an arbitration clause to settle any major disputes.

MLB instructed its 30 teams to determine only one minor league affiliate at each of four levels: Triple-A, Double-A, high Single-A, and low Single-A. Those assignments were announced last week, instantly eliminating 40 of the existing 160 MiLB affiliates. MLB had hinted at that intention earlier in the year before COVID hit, abbreviating the MLB season to 60 games and eliminating the minor league season.

With non-roster players having no place to play during the 2020 season, they were utilized and trained at what MLB called “alternative camps,” which would again be the case if there isn’t a MiLB season in 2021.

MLB lost a year of development at all levels and can ill-afford to repeat that process.

“Man, I don’t even want to think about that or go there yet,” New York Yankees manager Aaron Boone said during a Tuesday Zoom call with reporters. “Not having it would be, first and foremost, heartbreaking for those young players chasing their dream in ball. Hopefully we don’t get to that point and at this point I don’t think we will.”

There is what would be considered a force majeure clause in the contract beyond even the overall liability waiver in the case of no minor league season. It places all the burden on the MiLB owners. Under “Suspension of Performance, Especially Regarding the 2021 Season,” MLB stipulates:

“MLB deserves the right in its absolute and sole discretion to suspend its performance under the terms of the PDL without any obligation thereunder if it determines that PDL club players will not be supplied by one or more Major League clubs to PDL holders for any of the forgoing reasons:

“COVID-19, or any other epidemic or pandemic; labor dispute involving MLB Players Association; act of war or terrorism; natural disaster: severe weather, floods, fires, [or] earthquakes.”

The clause goes on to say that “consistent with the foregoing, MLB has not made a decision whether to utilize PDLs or PDL club affiliates for development in 2021 as a result of the pandemic.”

Also uncertain is how the coming COVID-19 vaccines, which began dispersal in the U.S. this week, might be applied to professional athletes and leagues. The National Football League Players Association said last week its members have no intention of “jumping the line” to take a vaccine ahead of older and at-risk people in the community.

The use of vaccines by players at the MLB level has to be collectively bargained under the category of health and safety issues with the MLB Players Association. The current Basic Agreement expires next Dec. 1, and collectively bargaining for a new agreement will commence some time after the new year when an actually start date for the 2021 big-league season is determined.

MLB can unilaterally ask staff at the big-league level, and everyone, including non 40-man roster players, at the minor league level, to be administered a vaccine. How MLB will procure thousands of vaccines, which have to be administered in two doses, is still a logistical question and certainly another clear impediment toward playing a MiLB season, which would traditionally start about 10 days after the MLB season is tentatively slated for April 1.

“In conjunction with our team of medical experts, we are tracking all developments related to vaccines,” MLB said in a statement offered to Sportico. “We are working on plans both to promote vaccination and to ensure that the members of our industry are vaccinated at an appropriate time.”

Washington Nationals manager Davey Martinez said in his own Tuesday Zoom conference he would take the vaccine as soon as it’s offered to him.

About another season without minor league baseball, he added:

“It’ll be tough, especially toward the development of our young players. We have some very talented players. They need to get on the field and play. If it doesn’t happen, it’ll definitely be devastating.”

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