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July 3, 2012

Overthinking It

Does Arbitration Drive Players Away?

by Ben Lindbergh

​"Why did they trade for me if that's what they think?"—Yankees left-hander Jim Abbott, after losing a 1993 arbitration case in which the team used a "very negative" presentation

Imagine, for a moment, that you’ve just accepted a job that requires you to join a union. This union is pretty powerful, but there are limits to its power. The main downside of your new deal is that you can’t control your own fate: for your first several years, you won’t get to choose which company you work for or where you spend most of your time.

On the plus side, you have a healthy minimum salary, your contract is guaranteed, and you know that if you keep coming to work, you’re virtually assured of making at least as much next year as you're making now. But if you want to increase your compensation quickly, your options are limited. If your employer doesn’t agree to give you a raise, the only way you can get one is to go in front of an independent arbitrator who knows little of your work and attempt to persuade him that you’re worth it.

Meanwhile, your boss will be doing his best to prove that you aren’t. He’ll bring up your lousy attendance record and all the time you spend reading articles about baseball when you’re supposed to be working. He’ll mention your long lunch breaks and that time you took a nap in the toilet stall. He’ll say you seem a lot like previous employees who didn’t make much more money than you’re making now.

Regardless of what the arbitrator decides, you’re not going to forget the things your boss said when he was trying to keep your salary down. You know it was just business, and you enjoy your job, and you’re making more money than most. Oh, and you get groupies! Life could be a lot worse. But when you finally earn your freedom and get to decide where you’ll be living and working for the rest of your career, won’t you still remember what was said? Won’t you wonder whether another company might value your skills more highly? And won’t you be inclined to decide that it’s time for a change?

It’s July, which makes this the perfect time to read about arbitration. The last arbitration case took place nearly five months ago, and the next won’t be heard until nearly seven months from now. You’re in arbitration withdrawal. You’re sick of hearing about the All-Star Game, the trading deadline, and the developing pennant races. You’re just marking time till mid-February, when teams and players whose negotiations have stalled will once again attempt to outargue each other over some relatively small sum of money. Well, I’m sorry—I can’t make the season end sooner. But I can try to answer a question that otherwise would have kept you awake until pitchers, catchers, and arbitrators report to spring training.