Salary arbitration is an option for baseball players who are eligible for a new contract but cannot come to an agreement with their parent club. They are not at the point in their career when they can file to become a free agent, but they have fulfilled their previous contract. Arbitration allows both the player and club to make a case on the size and length of the new contract. An impartial arbitrator will decide which side makes the more compelling case and go with that side's offer.
Player Eligibility
Players with three or more years on a Major League roster can file for salary arbitration. In special cases, a player can file for free agency with 2 1/2 years of service if they rank in the top 17 percent of players who have two years of experience but less than three years. In those cases, players will be granted arbitration eligibility even though they have less than three years of experience. Players cannot file for arbitration once they have six full years of experience. Those players can file for free agency.
Making the Case
In an arbitration case, the player will present his salary demand and he will make a case to an arbitration panel why he is worthy to earn the amount of money he has requested. He will make statistical comparisons and claims and bring up any other evidence that helps make his case. This can take several hours over the course of a day or two. The player's team will also make a salary offer and then make its case as to why its ofter is valid and why the arbitration panel should side with the team. The club will usually talk about the player's weaknesses and shortcomings.
The Decision
The arbitration panel will not make a compromise decision. Even though both sides may present valid points, the arbitration panel will decide which side made the more compelling case and go with that side's financial offer or demand.
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