How WAR would change arbitration

As the expiration of the CBA between Major League Baseball and the Major League Baseball Players Association approaches one of the points being discussed is a change to the way that arbitration is settled.

In a piece written by Jeff Passan at ESPN.com details MLB’s proposal at tying arbitration pay to fWAR from FanGraphs.

The MLB proposal would pay players based on their career fWAR earned with a rate based on their arbitration level. In a player’s first year of arbitration they would earn $580,000 per fWAR. This would rise to $770,000 per fWAR in their second trip through arbitration. In their final season of arbitration they would earn $910,000 per fWAR. Numbers can always be negotiated and would be subject to change.

Some players will surely benefit from a system that fully evaluates their value to teams and some will be hurt under any change from the status quo. To understand the impact this method of arbitration could have, let’s try it on for size with some current and previous Rays players.

Historical Examples

One of the first players that popped into my head that would likely benefit greatly from this kind of system was Ben Zobrist. In the five years heading into what would have been Zobrist’s final year of arbitration he amassed 28.9 fWAR from 2009-2013. This was the third highest fWAR during that time period and would’ve made Zobrist one of the highest paid players in arbitration.

Unfortunately we don’t have a comparison for Zobrist’s real world arbitration awards as he signed a long term extension. It’s also been ten years since his arb 1 season, so salary inflation would need to be accounted for.

Zobrist was one of the best players in the league but he started in a hole. Before his the 2008 season he had compiled -1.9 fWAR in 303 plate appearances. In 2008 he started a breakout in a very small sample of 227 plate appearances that dug him out of the hole and was just under replacement level through 530 MLB plate appearances. In 2009 he led MLB with 8.7 fWAR with his best single season.

While his path to getting these career fWAR totals were unusual this would be what you would expect from a player who consistently posted 4-5 fWAR seasons.

Photo by Adam Glanzman/Getty Images

Mike Trout has been the best player of his generation with a large gap between him and second place. His consistency at an elite level puts him in the discussion for best ten year start to a career in major league history.

Once again we have a player who signed an early career extension so we don’t really know what he would have gotten under the current arbitration process. These numbers would be seven years old at this time so salary inflation would affect these numbers, but he’d get paid.

Trout is remarkable for his consistently great seasons that have only been recently interrupted by injuries. When he plays he’s been great and in every one of his first five full seasons in the majors he put up eight plus fWAR and averaged just under 10 fWAR a season.

Mookie Betts is generally considered the second best position player in the majors and heading into the 2020 season he set the record for highest arbitration award at $27MM. In this case we actually get to compare what different processes would pay a player. The deals are also only dating back to 2018 so salary inflation should have a small impact.

Betts hasn’t been as consistent as Trout, but he averaged over seven fWAR per season through his first five seasons with a better single season at 10.4 fWAR than Trout has had.

Through the current arbitration process Betts earned $57.5MM over three years while under the currently proposed fWAR compensation system he would have earned $69.1MM. This is a difference of $11.6MM.

2022 Rays

The 2022 Tampa Bay Rays have a diverse pool of players arbitration eligible this winter. There are 16 players currently on the 40 man roster that are arbitration eligible.

MLBTradeRumors.com projects that the 16 players would earn $41MM through the current arbitration process. Based on the proposed system the players would earn $44.2MM.

Most of the numbers are very similar through both systems with Joey Wendle and Brett Phillips seeing the biggest differences. Both are players that bring defensive value and have brought more value to their teams than the counting stats would suggest.

Relievers are the spot that fWAR has had difficult evaluating. 2-3 fWAR is an elite season as a reliever and if you don’t receive high leverage usage the lack of innings will make it very difficult to put up more than one fWAR in a season.

Photo by Mike Stobe/Getty Images

Overall Thoughts

Overall I like a system that would eliminate the arbitration hearing from the process. We’ve seen things get ugly like when the New York Yankees faced off against Dellin Betances when he wanted to be paid as an elite reliever despite not having saves. Even though most cases don’t actually get to trial it’s a process that pits the team against a player where the team looks to expose their flaws in order to compare them to a lesser player. It’s an ugly part of the business.

The arbitration process relies on non-baseball people to determine the worth of a player’s contributions. Either side can use any publicly available metrics to make their case though the old school counting stats like home runs, RBI, pitcher wins, and saves play a major role as these are stats everybody has known for decades. Moving to a system that more closely aligns to how teams value players could be a good thing.

One thing I don’t love about this proposal is relying on one source.

There are many different versions of WAR that can evaluate the same player differently. I would prefer if you add something like rWAR from Baseball Reference and average the two in order to get a picture that incorporates more than one view as a balance.

This is especially necessary on the pitcher side where fWAR uses peripherals (FIP) to come up with their deserved ERA and rWAR uses runs allowed (RA9). Teams care far more about peripherals, which in our opinion makes fWAR the stronger metric, but there needs to be a mix in order to account for players who do over/under perform their peripherals.

The money side of the argument up to both sides to reach a middle ground, but I do think tying arbitration awards to WAR is a good step forward conceptually. The money can also be negotiated to increase year over year like they do in the draft pools. This makes it easier to push arbitration awards higher over time with consistency, as opposed to the current model of just waiting until the next Mike Trout makes his way through arbitration and pushes the upper bounds higher for everyone else.