Three Ways To Revamp The Archaic Baseball Operations Contract Structure

There’s the young front office employee who found out the week before his contract was up that it wouldn’t be renewed.

There’s the minor league coach who was told in early October that he would be brought back, only to be told in late October that there had been a change in plans and he was now out of a job.

There’s the longtime scout who was offered a new contract, but only on a part-time basis.

Conversations over the past decade with dozens of people in the game have led to an unavoidable conclusion: the current system works for MLB teams, but it’s awful for their employees.

No one involved in the game wanted to go on the record about this because of concerns of negative ramifications for their career. But time and time again, people said that the current contract system is archaic and exploitative. 

“It’s by far the most top-heavy, hierarchical structure I have ever experienced in the corporate world,” said one former front office employee who has worked inside and outside of baseball.

There’s a consensus that the system only works if everyone involved ignores the written rules. And it’s a system that gives free reign for teams to toy with the lives and careers of many people in baseball. The only thing preventing them from doing so is their own decency—the written rules provide no such protections.

The system was a problem before this year’s coronavirus pandemic. This year, it’s a further impediment for many in the game who are fearing massive cuts that could come in the next couple of weeks.

The Uniform Employee Contract states that its provisions can be suspended by the MLB commissioner in the case of a national emergency, allowing teams to cut the salaries of, or cease paying, employees altogether. But that same contract also notes that the “exclusive right to the Employee’s services shall remain in effect.” Teams have been able to stop paying scouts, coaches and other employees (as some clubs have done) but those employees are still prevented by contract from going to find work elsewhere.

Here’s how the system currently works. People who work in baseball operations (scouts, coaches, trainers, analysts and other front office employees) sign contracts with their team. Those contracts are usually on a one-year basis, with two-year contracts providing a rare signal of stability. The contracts tie the employees to the team, eliminating concerns about the team’s intellectual property being lost to other teams.

During that contract, those employees cannot speak with any other team about a job, whether it’s a lateral move or a promotion—it is considered tampering and can result in an employee being fired.

Usually, teams will notify employees a month or more before the end of the contract if they are not intending to bring them back. But there is nothing that requires the team to do so. An employee with a contract that expires on Oct. 31 may learn their fate on Oct. 31. As awful as that may sound, there are stories of that occurring.

Teams can request permission to speak to another club’s employee about a position, but an employee’s current team can turn down that request, even if it’s for a promotion. The current team does not have to inform the employee that the other team requested permission to speak with them, or that it turned down the request.

At least that’s how it is supposed to work. In reality, the only way to make the current system work is to learn how to operate around its edges.

Anyone who fears they may be let go at the end of their contract needs to have a network of close friends and associates in the game who can put out feelers for them. Complete trust and deniability is vital, because looking for another job could be grounds for being let go. 

That network can work to find potential openings and fits. If a match is found, the network connects the hiring team and the job-searching employee for a surreptitious conversation. If that goes well, the hiring team requests formal permission to speak with the job-seeker. 

“If someone requests permission it usually means they have already decided to hire them,” said one scout.

If someone around the game of baseball is looking to move up, they will likely use the same approach.

Those who don’t have a network or mentor who has laid out the unwritten roles are often left behind.

Multiple people said they believe that part of baseball’s problem in developing and promoting women and people of color is that the current system only works if they are part of a network. If they aren’t part of that system, the path for promotions becomes much more difficult.

“The number one most important trait in an executive rising (the ranks) is not skill, it’s having a patron saint,” said the former front office employee.

No one thinks the system as currently designed works well—even those who defend it. It needs improvement.  Here are three somewhat simple suggestions to fix some of the problems.

1. Synchronize every team’s contract calendar.

Right now, most teams operate on a Nov. 1-Oct. 31 contract year. But others operate on a Jan. 1-Dec. 31 schedule. If you work for a team whose contracts expire at the end of December, by the time you find out if you are being let go by your current team, most openings for teams who are on the other schedule will already be filled. Putting everyone on a November-October contract system would eliminate those disparities.

2. Force teams to make decisions earlier.

By Sept. 15, teams would be required to notify all employees in the final year of their contracts to let them know whether they will be tendered a contract renewal or informed that they will not be brought back. Those tenders would be contracts at the same terms as the previous contract—negotiations on salary, title and other aspects can continue between the employee and team).

Employees have until Oct. 15 to negotiate a new agreement or sign the tender. If they don’t have a new contract by the Oct. 15 deadline, the team can continue to negotiate with them or opt to tear up the contract tender.

For those who are told that they will be let go, tampering rules are waived after Sept. 15. Those employees are allowed to speak with other teams about potential positions, giving them 45 days before contract expiration to try to line up another job.

One of the main reasons for the contract system is the protection of intellectual property. Teams zealously guard their intellectual property, so the concern is employees looking for jobs elsewhere could take the team’s ideas and data with them to other employers.

A Sept. 15 decision date eliminates many of those concerns. It’s at the end of the Minor League Baseball season for coaches, trainers and many pro scouts. It’s after the summer showcase season—for area scouts. It’s less ideal for MLB coaches, analysts and front office employees, but it is late enough that even for them, the effects would be minimized. Teams can opt to let those employees go at the Sept. 15 non-renewal date—but would be required to pay them through Oct. 31—or they can opt to have them continue to work.

3. Revamp the permissions system.

Other sports require teams to grant permission to interview for employees who are being offered a promotion. A similar system could be adopted in baseball—if a team doesn’t want to offer permission they can do so by promoting the employee.

Just as importantly, teams would be required to notify employees whenever another team requested permission and would have to inform them whether that request was approved or denied.

Such a system would do very little to harm MLB clubs, but it would give the thousands of MLB employees a modicum of stability that is currently lacking. And it may help less-traditional front office candidates rise through the ranks.

It’s a system that should have been adopted in the 1990s. It’s well past time to do so in the 2020s.