MLB owners counter players’ union’s proposal with salary cap for first time since 1994-95 strike
The players’ union has already vowed it would never accept a salary cap in Major League Baseball, but that didn’t stop the owners from proposing one on Thursday.
The collective bargaining agreement between the MLB Players’ Association and the league’s owners is set to expire this December, and there are some pressing concerns that there could be another lockout situation that occurs. The last was after the 2021 campaign, though both sides came to an agreement after 99 days.
Now, the MLBPA reportedly submitted its first proposal on how to hopefully find common ground in 2027 and beyond. ESPN’s Jeff Passan reported the players’ first proposal focuses on the fact that cheap owners refuse to spend money to improve their roster, as they suggested a “competitive-integrity tax.”
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The owners balked on the proposal, not to anyone’s surprise, but they have came back with their own. And it’s the first time since the 1994-95 baseball strike that a salary cap has been pitched.
MLB’s proposal would set up a $245.3 million salary cap, while using figures for luxury tax payrolls that includes benefits and the pre-arbitration bonus pool. The proposal also establishes a payroll floor of $171.2 million.
Multiple teams, including the Los Angeles Dodgers, New York Mets, New York Yankees, Toronto Blue Jays and Philadelphia Phillies, would be well over the cap if it were to be implemented today. Owners noted in the proposal they would discuss a phase-in schedule, which would give those teams at the top of payroll spending a chance to comply with the imposed salary cap.
However, teams like the Miami Marlins, Cleveland Guardians, Tampa Bay Rays and Chicago White Sox, among others, would have to increase their payrolls to meet the proposed floor of $171.2 million.
Also, an escrow system with the union would be put in place where all current contracts would remain guaranteed and there would be no prohibition of guaranteed contracts under a salary cap system. After all, players are always looking for guaranteed money whenever they reach free agency, especially in MLB when those moments are fewer than other pro sports leagues.
The proposal is set to last seven year.
Other than the significant salary cap question, MLB also proposed to centralize local media revenue equally among the 30 teams, while giving players a 50-50 cut of it. The proposal also would eliminate the current revenue-sharing plan.
“Our salary cap and floor proposal levels the playing field while sharing baseball revenue with the players 50/50 as we grow the game together,” MLB spokesman Glen Caplin said in a statement. “Further, by sharing media revenue equally as part of our proposal, we can address another top fan concern of local TV blackouts.”
While both sides are tossing out proposals before summer even begins, talks usually heat up after the MLB season has concluded. It shouldn’t be expected that a deal is done during the 2026 MLB season, but there’s always the off-chance one side meets the other halfway.
However, union leader Bruce Meyer’s statement clearly shows the tension between the two sides.
“Billionaire owners are not seeking to cap their profits or asset values, only player salaries,” Meyer said. “This isn’t out of generosity or a desire to protect the game’s well-being. It’s a play to control costs, increase profits and maximize franchise values — all at the expense of players past, present and future.”
It’s no secret players want teams to keep spending, with those like Phillies’ Bryce Harper and San Diego Padres’ Manny Machado liking what the Dodgers have done, spending around half a billion to field a team of superstars. It’s worked out, winning back-to-back World Series titles in 2024 and 2025.
As part of the MLBPA proposal, players also want to increase the minimum salary from $780,000 to $1.5 million, as well as raising the first threshold in the competitive balance tax from $244 million to $300 million. This would allow more teams to spend more money without paying the luxury tax.
While other leagues have implemented salary caps, the NHL being the most recent in 2005-06 after their lockout wiped the 2004-05 season out of the record books, MLB has not found common ground to put one in place.
And when players like Juan Soto are inking a $765 million deal over 15 years with the New York Mets, why would MLB players want to cap that type of spending if an owner is willing to dish out such a contract?
“For generations, our members have fought against cap systems because they harm players at all levels, erode or eliminate contractual guarantees, pit player against player, lead to more work stoppages, not less, and get worse for players over time,” Meyer said. “Caps don’t lower ticket prices for fans, eliminate tanking or ensure teams are run with equal competence. They suffocate competition by offering owners an all-purpose excuse for inaction and mediocrity.”
It’s bound to be contentious negotiations, but it’s just getting started here as the 2026 season plays out with the expiring CBA dangling over the sport. The deal is set to expire on Dec. 2.
The Associated Press and OutKick’s Ian Miller contributed to this report.
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