Explaining Non-Tenders

Russell Martin, Alfredo Aceves and Joel Peralta were all non-tendered last offseason. One year later, we’re well on our way to welcoming another class of non-tenders to the club. It can be a confusing kind of transaction, so here’s an explanation of what exactly a non-tender is.

To tender a player a contract is to offer a contract, but non-tenders refer to a specific kind of offer: offers of arbitration. Rules and precedent shape the kind of salary a player can expect through arbitration, so players under team control usually get raises through the process. 

For example, Jacoby Ellsbury isn’t eligible for free agency yet, but he and agent Scott Boras have some say in his future earnings. If the Red Sox offered Ellsbury $3MM in arbitration this offseason, Boras and Ellsbury could counter with a $10MM submission and win. Arbitration can be expensive for teams, since a player’s salary depends on his previous earnings and comparable players.

Players generally earn $400K or so for their first few major league seasons, so they’re usually relatively cheap in their first arbitration seasons. But players entering their second, third or (for super twos) fourth arbitration seasons stand to make more money if they’re tendered an offer. 

If an arbitration eligible player hasn’t performed well and projects to earn a considerable amount, his team will likely consider a non-tender to save money and preserve roster flexibility. That means they have turned down the option to negotiate a contract with that player through arbitration, but it doesn’t mean the player’s going to sign elsewhere.

Left-handers Hideki Okajima and Andrew Miller both re-signed with the Red Sox after Boston non-tendered them last winter. The Red Sox signed the pair of pitchers for less guaranteed money, but only after they risked losing them to rival teams. (After a player is non-tendered he hits free agency and can sign anywhere.)

It’s complicated, but here’s what you need to know: teams non-tender players when they would rather risk losing them to another team than go through the potentially expensive arbitration process.

MLBTR first published a modified version of this post by Ben Nicholson-Smith in September 2010.