Free agency begins
Free agency in baseball refers to the system that allows players to negotiate contracts with any team after their current contract expires, which significantly enhances their bargaining power. Prior to the mid-1970s, players were bound to their teams indefinitely due to the reserve clause, which meant they could only leave through a trade or release. This changed in 1975 when pitcher Andy Messersmith contested the reserve clause in arbitration, leading to a landmark decision that established players' rights to free agency. The impact of this ruling was profound, enabling players to seek higher salaries and negotiate with multiple teams, fundamentally altering the dynamics of player-team relationships and compensation.
While free agency has empowered players financially, it has also led to challenges such as diminished team stability and increased disparities between wealthier and poorer teams in attracting talent. Over the years, team owners attempted to limit free agency through various means, including illegal conspiracies, which resulted in financial penalties. Ultimately, the advent of free agency has created a landscape where player salaries have escalated, reflecting their newfound leverage in the sports industry.
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Subject Terms
Free agency begins
The right of a professional baseball player to sell his services to the highest bidder
Date Instituted in 1976
The change to a system of “free agents” created the modern era of high-salary players who change teams several times in a career.
Before the mid-1970’s, through the so-called reserve clause, a baseball team could indefinitely renew a player’s contract or prevent him from signing with another team. Thus, a baseball player had to play his entire career for the same team unless that team traded him or chose to get rid of him. This prohibited a player from switching teams and destroyed a player’s ability to negotiate a higher salary from his current team.
Then, in 1975, Andy Messersmith, a successful pitcher with the Los Angeles Dodgers, refused to sign the contract given to him by the team. The Dodgers automatically renewed his contract for the next year using the reserve clause. Messersmith argued in an arbitration case against the team that his contract was over and that he was free to sign with any team. The arbitrator assigned to the case agreed with Messersmith and decided that the standard baseball contract did not create a perpetual contract between the team and the player.
The decision was revolutionary. Messersmith and many other players took advantage of their newfound freedom to negotiate higher salaries with new teams or signed new contracts with their old teams for equally high salaries. The owners attempted to restrict free agency in later labor agreements with the players union, but they were largely unsuccessful, and a series of strikes by the players and lockouts by the owners ensued.
Impact
Free agency forever changed the game of baseball on the field and in terms of the business of the game. Before the 1970’s, most star players were relatively underpaid and tended to play their entire careers with a single team. After the advent of free agency, players had greater bargaining power and used that power to obtain the best deals for themselves. Although beneficial for the players, free agency later contributed to the loss of a stable team identity and a growing disparity between the ability of richer and poorer teams to sign free agents and consistently put together winning teams.
Subsequent Events
The owners continued to fight unsuccessfully the effects that the new free agency system forced on them. During the 1980’s, the owners illegally conspired to refuse to sign free agents and were forced to pay millions of dollars of damages to the affected players. From that time forward, player salaries have continued to rise.
Bibliography
Abrams, Roger I. The Money Pitch: Baseball Free Agency and Salary Arbitration. Philadelphia: Temple University Press, 2000.
Waller, Spencer Weber, Neil B. Cohen, and Paul Finkelman. Baseball and the American Legal Mind. New York: Garland, 1995.