You've probably noticed a flood of posts the last few days titled "[Team], [Player] avoid arb" or some variety thereof. Rather than just the usual "[Team] signs [Player]" headlines of the nine-tenths of the year, almost every new contract agreed to over the last several has included the word arbitration.
Arbitration, as you may have guessed, is not an original baseball term but rather a gross lawyer word. Coming from Latin and/or Old French, it concerns the settlement of a dispute by third party (or: arbiter).
In the case of Major League Baseball, arbitration involves settling salary disputes between player and team by bringing in an independent arbiter to hear cases from both sides and provide a resolution.
It takes quite a few steps to get into an actual hearing, however, so let's first discuss how we get to that point:
Who can file for arbitration?
1. All players who have between three and six years of MLB service time* are able to file for arbitration, so long as:
- The player does not have a contract for next season.
- The player was tendered a contract before the non-tender deadline.
- The player cannot agree on a new contract with his club.
2. All players who have been granted Super Two status, meaning:
- The player has more than two years' service time, but fewer than three.
- The player earned at least 86 days of service time during the 2012 season.
- The player ranks in the top 22 percent of all two-year players in re: service time.
*To simplify, a player earns a day of service time for each day on a club's 25-man roster. 172 days is considered a year of service time.
What happens when one files for arbitration?
On the arbitration filing day -- which was this Tuesday, January 15 -- eligible players submit to the MLB Player's Association (MLBPA) their intention to file, along with a desired salary figure. The MLBPA then notifies the MLB Labor Relations Department (LRD) which players have elected to file arbitration -- 132 players did so this year -- giving the LRD three days to gather a desired salary figure from the player's club.
At the "exchanging figures" deadline -- that'd be 1pm ET today -- the MLBPA presents the salary figures for those players who have yet to "avoid arbitration" with the LRD, who present the team's figure.
NB: Up until the 1pm ET deadline today, clubs are able to sign arb-eligible players for whatever salary they desire, so long as it meets the new CBA's guidelines. After the deadline, however, clubs can only negotiate between the two salaries figures presented.
If player and team cannot come to a resolution (on a salary between the "exchanged figures") by the time of the scheduled arbitration hearing -- which will occur from February 1 to February 20 -- then an arbiter will hear the case and decide a "winner," setting the player's salary for the coming season.