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April 15, 2013

Fantasy Freestyle

Searching for Value in Contract Clauses

by Mike Gianella

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When I was a small child everything I knew about baseball came from either the back of a baseball card or what the local color guys for the Yankees and Mets told me on TV. During this impressionable age, I remember reading about Steve Stone winning the Cy Young Award in 1980 and how he earned a $10,000 bonus for his trouble. As an impressionable lad, I figured that for Stone to have this bonus in his contract he had to be an excellent pitcher. Some superficial research told me that this wasn’t the case at all; Stone was a solid-but-unspectacular pitcher. As I learned from the back of this particular baseball card, the bonus clause was put into the contract, but it was something the Orioles figured he’d never collect.

“It was like an insurance salesman telling you, ‘We’ll give you $50,000 if an elephant falls on you,’ because he knows darn well an elephant isn’t going to fall on you,” Stone said at the time.

“Elephant clauses” are popular with some general managers and teams for precisely the reason Stone cited. Give a player a modest incentive to succeed with an incentive clause, and if he does, the modest cost of the clause is far outweighed by the value the player provides. If the player doesn’t succeed, it costs you nothing beyond the value of the contract.

One of Baseball Prospectus’ readers wanted to know if there was a correlation between games-finished clauses and pitchers becoming closers in-season. Thanks to the excellent work of Baseball Prospectus’ Jeff Euston, I have the ability to go back and look at a healthy amount of contracts with games-finished clauses and whether or not these pitchers wound up closing.

Table 1: Pitchers with Games Finished Clauses and How They Fared

Player

Team

Year

Bonus (Millions)

GF

Saves

Carlos Marmol

Cubs

2010

0.10

70

38

Matt Capps

Nationals

2010

0.43

66

42

Jason Motte*

Cardinals

2012

0.08

58

42

Jonathan Broxton

Dodgers

2009

0.20

58

36

Joel Hanrahan

Pirates

2012

0.05

57

36

Juan Oviedo

Marlins

2011

Unknown

51

36

Kyle Farnsworth*

Rays

2011

0.30

51

25

Matt Capps

Pirates

2009

0.05

50

27

Octavio Dotel*

Pirates

2010

Unknown

50

22

Jonathan Broxton

Reds

2010

0.5

46

22

C.J. Wilson

Rangers

2009

0.15

30

14

Matt Capps

Twins

2012

Unknown

29

14

Guillermo Mota

Dodgers

2009

0.08

27

0

Rafael Betancourt

Rockies

2011

0.40

24

8

Jon Rauch

Mets

2012

0.50

22

4

Koji Uehara

Orioles

2011

0.25

22

0

Koji Uehara

Orioles

2010

1.25

22

13

Kameron Loe

Brewers

2012

0.23

20

2

Rafael Betancourt

Indians

2008

0.60

20

4

Kyle Farnsworth

Royals

2009

0.25

18

0

Rafael Betancourt

Rockies

2010

0.40

18

1

J.J. Putz

White Sox

2010

3.00

16

3

Jesse Crain

Twins

2009

0.38

15

0

Kyle Farnsworth

Royals

2010

0.25

15

0

Jesse Crain

Twins

2008

0.38

14

0

Matt Belisle

Rockies

2012

0.23

14

3

Andrew Bailey

Red Sox

2012

0.10

13

6

Francisco Rodriguez

Brewers

2012

0.63

13

3

John Grabow

Pirates

2009

0.05

12

0

Damaso Marte

Pirates

2007

0.75

11

0

Matt Belisle

Rockies

2010

0.20

11

1

Scott Downs

Angels

2011

1.00

11

9

Craig Breslow

Athletics

2011

0.03

10

0

Damaso Marte

Pirates

2008

0.75

10

5

Mark Lowe

Rangers

2011

0.03

10

1

Rafael Betancourt

Indians

2009

1.25

10

2

Scott Downs

Angels

2011

1.00

10

1

Octavio Dotel

Yankees

2006

2.50

7

0

Hung-Chih Kuo

Dodgers

2011

0.50

5

0

Jason Isringhausen

Rays

2009

1.00

4

0

Bobby Jenks

Red Sox

2011

1.00

4

0

Brad Penny

Red Sox

2009

3.00

0

0

Koji Uehara

Orioles

2009

1.25

0

0

Joakim Soria

Royals

2012

Unknown

DNP

DNP

Nick Masset

Reds

2012

0.55

minors

minors

Taylor Buchholz

Rockies

2009

0.05

DNP

DNP

Bobby Jenks

Red Sox

2012

1.00

DNP

DNP

The italicized are the pitchers that hit at least one of their games-finished clauses. The pitchers with an asterisk next to their names were not closers the prior year and assumed the reins the year their incentive clause was in place.

Including duplicates, there are 47 pitchers on this chart. Ten of them reached at least one of their games-finished clauses. Three of those pitchers—Octavio Dotel, Kyle Farnsworth, and Jason Motte—reached those clauses after not closing the previous season, but Farnsworth was the only one who didn’t start the campaign as closer and then wound up inheriting the job.

It seems, then, that the games finished incentive clauses serve two purposes:

  1. The clauses can be used to incentivize existing closers and make them more money if they succeed in the job that they already have.
  2. The clauses are the so-called “elephant clauses” that Stone referenced. The 2006 version of Octavio Dotel wasn’t closing unless something horrible happened to Mariano Rivera. More than a few of the pitchers on this list were clear backups to a rock solid closer.

So chasing pitchers due to games-finished clauses in the hopes that you might find an in-season closer is tilting at windmills. In case you’re curious, though, here are the relievers that have games finished clauses in 2013 and beyond:

Player

Team

Year

Bonus

J.P. Howell

Dodgers

2013

0.70

Jim Johnson

Orioles

2013

0.05

Joakim Soria

Rangers

2013

1.10

Joba Chamberlain

Yankees

2013

0.28

Joel Hanrahan

Red Sox

2013

0.06

Koji Uehara

Red Sox

2013

1.00

Kyle Farnsworth

Rays

2013

1.65

Matt Belisle

Rockies

2013

0.23

Matt Lindstrom

White Sox

2013

1.13

Mike Gonzalez

Brewers

2013

0.40

Ryan Madson

Angels

2013

1.00

Sergio Romo

Giants

2013

0.20

Jason Motte

Cardinals

2014

0.50

Matt Lindstrom

White Sox

2014

1.13

Scott Downs

Angels

2013

1.00

Logan Ondrusek

Reds

2013-2014

0.20

Sean Marshall

Reds

2013-2015

3.00

Glen Perkins

Twins

2013-2016

Unknown

The future games-finished clauses seem to fit the same profiles: either established closers or elephant clauses. Soria’s clause would be interesting should something happen to Joe Nathan, but then this assumes full health sooner rather than later for Soria.

The lessons in buying closers or chasing would-be closers remain the same: Chase skills, not roles. If you must buy into roles, make sure that you pay for the guy with the fat contract; it’s far less likely the team will jettison him after one terrible outing. Games-finished clauses are fun to look at, but don’t get distracted by the elephant in the room.

Mike Gianella is an author of Baseball Prospectus. 
Click here to see Mike's other articles. You can contact Mike by clicking here

1 comment has been left for this article.

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