Baseball Free Agency Rules
MLB Player Eligibility and Draft Compensation Explained
Feb 23, 2008 James Lincoln Ray
Basic Player Eligibility
A player may declare himself a free agent, and is thus free to negotiate with any team for a new contract if:
(1) He has at least 6 years of Major League service; and
(2) He is not already under contract for the next season.
Free Agent Filing Period and Former Club's Exclusivity Period
A player must file for free agency within 15 days from the first day after the World Series ends.
The player’s former club retains exclusive negotiating rights during that 15-day period, even if the player declares free agency on the first day after the World Series (the "Exclusivity Period.").
The former club may re-sign the player at any time, during or after the filing period. During the 15-day Exclusivity Period, a player who has filed for free agency may engage in general discussions with other clubs, but he may not discuss contract details or sign with them.
The Free Agency Procedure
A club receives compensation if it loses a free agent before December 2. (Free Agent Compensation is discussed at length below.)
By December 1st, each Major League team must decide whether to offer salary arbitration to their former players who have filed for free agency. A club not offering arbitration may continue to negotiate with the player but does not receive compensation if he signs with another club.
By December 7th, a player who has been offered arbitration must accept or reject. If the player accepts the offer, he returns to his club’s 40-man roster. The player and club may continue to negotiate before the above-described February arbitration hearing. If the player rejects the offer, he may continue to negotiate with any of the Major League Baseball's 30 clubs.
A free agent who signs a Major League contract may not be traded without his written consent before June 15th of the following season.
Limits on free agent signings
If only 0-14 players in all of Major League Baseball file for free file for free agency, no team may sign more than one "Type A" or "Type B" player (terms defined below).
If 15-38 players file for free agency, no team may sign more than 2 such free agent players.
If 39-62 players file for free agency, no team may sign more than 3 such free agent players.
If 63 or more players file for free agency, then there are no such limits applied. Furthermore, a team may sign as many type A and B free agents as it has lost, regardless of the limits above.
Free Agent Compensation
A club may receive draft-pick compensation if it loses a free agent if:
(1) the player signs with another club before December 2; or
(2) the club offered arbitration to the free agent but failed to re-sign him.
Free agent compensation is based on the free agent’s place in the Elias Sports Bureau’s ranking of all major league players by position based on their performance during the last two seasons. Players are ranked by league in one of five positional groups: 1) 1B/DH/OF, 2) 2B/SS/3B, 3) catchers, 4) starting pitchers or 5) relief pitchers. The statistical criteria vary by position, and are not made available to anyone outsideof Major League Baseball.
Type A players are those who rank statistically in the top 20 percent at their position. Compensation for a Type A player is the signing club’s first-round draft pick and a supplemental pick between the first and second rounds.
Type B players are those who rank between the top 21 and 40 percent. Compensation for a Type B player is a supplemental pick between the first and second rounds.
If a team loses a free agent who is statistically in the bottom 60% of all players at his position, the former team does not get any compensation.
That pretty much sums up the rules of free agency and free agent compensation. If you want any more information than that, you probably need to get another hobby, or maybe even a girlfriend.
Just kiddin'.
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