1/30/19

Reese Kaplan -- Gambling on Chronically Injured Players



We Mets fans sometimes forget that baseball is a hybrid of athletics and entertainment, but to the guys in the front office it’s also a business.  I’m not here to get into the debate about having to spend money to make money.  In fact, it’s quite the opposite today.  Let’s take a look at how saving money might make the game a bit more interesting.

Most of us who work for someone else enjoy some employee benefits.  There’s health insurance, dental, vision, 401K matching funds, long and short-term disability, and various other potential things to entice you to remain employed with this same firm.  Having indulged in most of these benefits at one time or another, I can say they are indeed appreciated.

Outside of this space a number of the Macks Mets Marauders (which sounds a bit more impressive than just a few guys with time to kill texting and emailing) were joking about the contract recently extended to A.J. Pollock by the Dodgers.  He’s going to get 4 years and $55 million with a 5th year option at $10 million or a $5 million buyout.  To stay under the luxury tax cap, they’re calling it a 5 year contract with an Average Annual Value (AAV) of $12 million.  Since that number is likely less than the man had hoped to earn, they sweetened the pot with an opt-out at Year 3 if he achieves a certain number of plate appearances.   And therein lies the rub.

In his last year in Arizona Pollock earned a hair over $7 million and produced a slash line of .257/21/55 with 13 SBs.  He appeared in 113 which was his high water mark since 2015 when he appeared in 157.  Pollock is a talented player having hit as many as 21 HRs, driven in as many as 76 and stolen as many as 39 bases in a single season while maintaining a lifetime batting average of a very respectable .281.  Great stuff, right?


Unfortunately, Pollock has been in the league now for a total of seven years during which time he’s appeared in 637 games.  If you do the math, that’s an average per year of just 91.  So is a guy who’s slated to miss more than 1/3 of his team’s games really worth a $60-$65 million gamble?  (Think of him as a much more productive Juan Lagares to get the point.)

So now let’s come back to the real world where none of us are on full salary when we miss a significant amount of time away from work.  In terms of short-term disability, a recipient typically gets anywhere between 50% to 85% of his salary for up to 3 months away from the job.  This money is paid directly by the insurance company based upon premiums paid by or shared by your employer and the employee himself.  In a long-term disability scenario, there is a lower salary percentage paid out, as low as 40% in some cases.  This disability payment can extend for the duration of the illness or injury afflicting the employee.

Now let’s come back to the baseball world where only the superstar players are covered by disability policies.  We all know quite well that when David Wright was out he was earning his full salary, but in this case after 60 days of inability to take the field the Mets and not Wright were paid 75% of his salary.  Yoenis Cespedes has a parallel type of coverage, but from what we gather the stipulations and percentages differ, but the principle remains the same.  However, what happens if a Keon Broxton suffers a season-long injury?  Methinks the Mets are not covered and they must eat the entirety of his salary.      

One of the reasons people shied away from A.J. Pollock was the issue of his cost plus his likely lengthy stay on the DL.  That means adding significantly (as the Mets did with Wright and Cespedes) to the cost basis plus creating a mega-hole to fill when he’s unavailable. 

So the immodest proposal discussed amongst the braintrust was whether or not the injury risk should be a shared responsibility as it is in the real world.  This approach could be handled a number of ways.  First, you could simply parallel what is done in corporate America and have the disability issue handled between the insurance companies and the covered players.  They would receive less than normal pay since they are not contributing. 

Of course, this approach would probably exacerbate Workman’s Comp claims if the injury indeed happened at the jobsite.  When Juan Lagares crashed into an outfield wall, he required surgery to fix his torn ligament.  Isn’t that the very definition of being hurt on the job?

Another approach could be a discount in flat dollars or salary percentage for each day a player stays on the disabled list.  I had joked about Pollock kicking back $500K for every day he’s on the DL.  A more realistic approach might be to get a discount of 1/162 of a player’s salary for each DL day.  That way it is as fair to the guys earning minimum wage as it is to the guys in the $30 million annual salary neighborhood.

There would be an ethical battle waged on both sides should such a solution be implemented.  Teams would find multiple excuses to keep a borderline player on the DL as long as possible in order to get salary dollars kicked back.  Correspondingly, the players would try to rush back through rehab to begin earning full paychecks once again. 

So I would think the basic corporate America solution would be the one that would work best.  Players are then accepting some of the risk for injuries and illnesses (think Ike Davis’ Valley Fever, for example).  Clubs might be more willing to roll the dice on the chronically injured if they know they are not the ones on the hook for full salary. 

Of course, the Players Association in the Collective Bargaining Agreement would never go for anything like this, but what do you all think?

11 comments:

Tom Brennan said...

Mack is paying me 10 years - $300 million, so I am not concerned about benefits.

I think a simple solution would be that a guy gets a 20% haircut for each day on the DL. So, if a guy is making $16.2 million, that's $100,000 per game. For every game on the DL, you lose $20,000.

So, let's say Joe Blow is your # 1 starter and he makes $16.2 million - he needs TJS after 30 games, and is out for the season. He loses 20% of $13.2 million, or $2.6 million, of that $16.2 million. That player would not have to pay taxes on the lost $2.6 million, so let's say he loses, net, $1.5 million. Not such a big deal.

And, so the owners don't get rich on the saved $$, expand the rosters to 26 and also raise the minimum salary by 20%.

Mack Ade said...

Maybe we should go back to the days when an owner mailed a one year contract to each player pre-spring training.

Yeah I know... Player's Union

Very few teams go out of the way to sign players with a history of injuries. Instead they sign or extend players that are both talented (gold glove) and uber healthy... like Juan Lagares

I believe the future of this game lies in 2 yr. deals with a 3rd yr team option.

Short enough so a player can move on to a better deal with another team if he both produces and stay healthy...

Cost effective enough for a team tha can financially live with a deal like this if it blows up in their face.

Mack Ade said...

I loved Blow

Tom Brennan said...

Mack is WEEDING out the bad ideas

Reese Kaplan said...

While listening to the Doobie Brothers?

Tom Brennan said...

Can players use medicinal marijuana?

Reese Kaplan said...

Or recreational in Colorado or Seattle where it's legal?

Tom Brennan said...

We'll track players by ERA, BABIP, and THC.

Mike Freire said...

Or, you could pay everyone the same base pay annually that increases based on years of service.

At the end of the year, you get "bonus" pay for your performance....you could work out a formula so that the better you play, the more you make.

Crazy on the surface, but doable.

Oh and Juan Lagares looks like Cal Ripken when compared to Pollack!

Tom Brennan said...

Juan Lagares just gave up baseball to join the Flying Wallendas

Dave Schulps said...

Not sure how Lagares looks like Cal Ripken compared to Pollack, since Pollack has averaged 325 at bats per season for his seven MLB seasons, while Lagares has averaged 283 over his six. Seems like birds of a (broken) feather to me.