MLB Avoids Work Stoppage With Last-Minute Labor Deal

There will be labor peace in baseball for the next five years.

While there are no games to be lost at this point, without a deal or an extension of the current collective bargaining agreement, baseball faced the prospect of a hold on transactions and other offseason business only hours after the Mets finalized their $110 million, four-year contract for Yoenis Cespedes and held a news conference with the outfielder in NY on Wednesday.

Players and owners had until midnight to reach a deal. Had that happened, it would have been the first time in 21 years baseball experienced a work stoppage.

Rather than a draft, there will be a hard bonus cap for global signings. It also appears that an global draft is also off the table, but the current system of signing worldwide free agents seems likely to change nonetheless.

The union has always been fundamentally opposed to artificial restrictions on salaries and remained mindful of that in these negotiations. The players union even went so far as to send Latin American players to negotiations to argue against the measure. The owners reportedly dropped the issue in the days leading up to the deadline. But the union strongly opposes an global draft, in part because foreign-born amateurs do not have the same leverage and opportunities as their US -born counterparts, including college, sources said. Clubs that exceed the luxury-tax threshold, though, would lose a pick later in the draft. In three seasons with Akron, Wallace has guided the RubberDucks to a 223-202 mark. Instead, the team with the better regular-season record will receive the extra home game. This is all void, though, if the team in question pays luxury tax, in which case that team's compensation will be after the fourth round.

The uninterrupted play has been central to Major League Baseball growing to a $10 billion annual enterprise (and rising) with record sales prices for franchises and record salaries for players. If a club is over the luxury tax threshold, they will be forced to surrender a 2nd and 5th round pick, as well as $1 million in global bonus money used for signing worldwide players not subject to the Major League Baseball draft. That's the thinking, at least. Perhaps most significantly, the Qualifying Offer system is getting major renovations, starting next offseason. Those in the middle forfeit their second-highest pick and have their worldwide bonus pool reduced by $500,000 next season.

Also, clubs that sign a premium free agent will not have to yield a first-round draft pick to the team that lost the player. The current qualifying offer rules will still apply to this year's group of free agents. But believe it or not, the luxury tax correlates with the qualifying offers.

The DL change will allow teams to make quicker decisions on whether to bring up a roster replacement rather than wait to see whether the injured player would be ready to return to action in less than two weeks. Though some of the final issues were significant - and the global draft, in particular, an emotionally charged one - most industry observers felt the possibility of a work stoppage was remote all along, if only because both sides recognized the economic health of the sport and understood a stoppage was the surest way to squander it. It seems likely the system will be reworked moving forward.

If the luxury tax threshold is set too low, players will get upset. After that, both sides would have had to agree to an extension or the owners could have imposed a lockout that would have frozen trades and free agent signings, and benefits to players. This could facilitate a change in ownership, or the team moving altogether.

The two sides reached an agreement late Wednesday, just hours before the deadline, Ken Rosenthal of Fox Sports first reported.