Explaining Major League Deals For Draft Picks

2011 draft pick Trevor Bauer already received a Major League deal from the Diamondbacks, and a few more players might receive one today.  Via email, Baseball America's Jim Callis named Gerrit Cole (Pirates), Danny Hultzen (Mariners), Dylan Bundy (Orioles), and Anthony Rendon (Nationals) as candidates.  Be sure to follow Jim on Twitter to get all of the latest draft pick signing scoops.

In a 2008 article, ESPN's Keith Law explained that "a typical minor league contract signed by an amateur player will fix his signing bonus and his salary for the first year of his minor league playing career."  A Major League deal, meanwhile, benefits the player by placing him on the 40-man roster and therefore making it easier to promote him to the Majors later.  The player also has the potential of seeing a domino effect on future salaries, as his salary cannot be less than 80 percent of his total compensation from the previous year.  For example, the Tigers' Rick Porcello is earning $1.536MM even though he is not arbitration eligible until after the season, and that lifts up all his future salaries.

The team loses roster flexibility with a Major League deal for a draft pick, though it gains the advantage of lowering the average annual value by spreading it over multiple years.  This advantage can be gained through two-sport deals without the sacrifice of a 40-man spot.  Callis notes that Bubba Starling and Archie Bradley will get this type of contract.  

Players have three or four years in which they can be optioned to the minors without clearing waivers, and with a Major League deal the first option is typically going to be used in the player's first year.  This sometimes accelerates a player's timetable and forces the team's hand.

Nine teams currently have at least one opening on the 40-man roster, though as one baseball source noted, most teams have two or three guys they could easily remove this time of year.


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