Dodgers outfielder Yasiel Puig has elected to keep his guarantee over the following two seasons rather than opting into arbitration, Ken Rosenthal of FOX Sports reports on Twitter. That’s the opposite choice from that made yesterday by White Sox slugger Jose Abreu, who faced a similar — but hardly identical — situation.
In both cases, the decision was fundamentally one of risk and reward in earnings. Neither player had the right to take action that would have shortened the control rights of their respective teams. But both had to weigh whether to retain the multi-year guarantees in their contracts, or instead seek potentially higher paydays in arbitration.
MLBTR’s Tim Dierkes laid out the essential factors in this post, pertaining to Abreu, and you’ll want to read that post to understand them. In Puig’s case, his original free agent deal provides that he’ll earn $6.5MM this year and $7.5MM next. He remains controllable via arbitration so long as he lacks the service time for traditional free agency — unlike some international players, whose deals provide for early releases — so he was set to be arb-eligible for the 2019 season regardless.
The question, then, was whether he was better off taking that two-year, $13MM guarantee or entering the wilds of arbitration. With his numbers on the decline over the last two seasons, there’s no chance he’d rate as a $6.5MM first-year arb earner. But because players typically don’t have their salaries trimmed in arbitration, his already-high earning level gives him a big earning minimum for 2017 — which also would have provided a nice base from which to work in playing his way toward a raise for 2018.
So, what might Puig have earned? If you divide his $12MM signing bonus over the seven seasons of his deal, and add it to his $5.5MM salary from 2016, he’d have a baseline of just over $7.2MM. With a net-present-value adjustment on the bonus, that could go to approximately $7.5MM, with the potential to argue for even more by pushing a theory that the arb opt-in reduces the length of the deal (thus boosting the share of the signing bonus assignable to his 2016 salary, increasing the floor).
That all sounds like gravy, but there are risks, too. The CBA is not clear on precisely how to make these calculations, so that’d all have to be argued over in arb. And there are examples of players — most recently, Leonys Martin — who suffered salary drops in arbitration from their prior years’ marks. And then there’s the fact that parting with the guarantee would’ve left Puig’s salary for 2018 dependent upon his performance in the year to come, with a non-tender a possibility if things go poorly.
All told, taking the sure $13MM isn’t the upside play. But many players accept two or three-year, arb-only extensions that sacrifice some earning ceiling in exchange for security. It’s arguable that Puig didn’t have much to lose, but his mediocre 2016 season may have left him unsure of taking the risks of trying to maximize his earning power through the arbitration process.
I’m a little confused. If he went to arbitration they could pay him less than his contract says? And the Dodgers giving him that contract didn’t actually buy out his arbitration years? Could they have?
If a player opts out of a contract, the contract is then void. That means the Dodgers could most definitley offer Puig less money in arb and Puig could ask for more money.
If I’m reading his contract correctly, he would have 1 arbitration eligible year in 2019 after making $6.5M in ’17 and $7.5M in ’18. Might depend on service time over the next 2 years.
I think these comments came before I finished the full post, but I think what’s written now should cover this.
Got it. Thanks!!
If he chose arbitration then he would have opted out of his contract. And the Dodgers most certainly would have offered him less money than the $8 odd million he’ll make in 17 due to the fact that he has underperformed his earnings thus far.
If they were to offer something that fell short of what he’s entitled to, Puig could just go to a hearing.
Smart enough play on his part. For the drama that the Puig saga has been this past couple years take your nice guaranteed pay checks and work on rebuilding your value for free agency in two years time without any headaches. Also lets teams know exactly what his compensation is going to be when trading for him this offseason though that wasn’t likely to vary enough to truly impact a deal anyways.
As a Braves fan my only reaction to hearing this is http://bigmommamemes.com/u072/ca63f501-2b08-4cc3-af14-49ee70bb23c1
Still somewhat surprised by Yasiel Puig’s decision. Had he opted into arbitration he might have become become a free agent if the Dodgers elected to non-tender him by the December 2nd deadline. It could have also put more pressure on the Dodgers to try and deal him to another team by that date.
That being said, Puig’s days in L.A. appear numbered. He needs a change of scenery and some club that believes they have the support team in place to deal with Puig just might be getting themselves a potential MVP talent on the cheap…perhaps one like the White Sox with their new Hispanic manager Rick Renteria, a big brother friend and teammate in Jose Abreu and an organization that prefers operating “on the cheap”. LOL
The dodgers weren’t going to NT. Plus his salary due to performance he’s not winning a hearing. So it’d put no pressure on the Dodgers really. They could easily “Salary Dump” him but he has to much talent. They’ve shown there willingness to wait and hold onto.
We’ll never know now about the non-tender or any result from the arbitration process in the next two years. However, with Puig’s guaranteed contract now intact, a DFA or “salary dump” would be far more costly to the Dodgers. Regardless, I still doubt that he’s a member of the Dodgers on opening day and any trade for him will assuredly be for far less value than what his skill set would demand.
Not really, but I do agree he will be moved. But such does not exclude him from being a part of a package to bring in a superior talent. So one on one yes you don’t get what his talent usually calls for, but then again it doesn’t matter there’s nothing you can do.
puig needs a new location and possibly a smaller media market. he’s not doing well under the microscope there, but he’s young and talented. he just needs to go somewhere where he can get some PAs without all the current expectation and the dodgers have effectively disowned the guy. could he be an option for the astros?
I don’t see it he’s going to be part of package, not necessarily a centerpiece, that brings in a premium player. So I don’t see many Astros players that fit the needs of the Dodgers except for a Bregman but we all know how unrealistic that is.
What is the source of the argument that LA is a pressure cooker sports market? This isn’t Boston, or New York, not by a long shot, and as one who spends a lot of time in Dodger Stadium I can attest to the fact that Puig remains a fan favorite, struggles or no. Even at his worst he’s an exciting player to watch. The fans get that. Any team would have the same expectations of him so he isn’t going to escape those by going to that mythical relaxed small market team, though he would escape all the fan support he’s found here. I can’t see how that would benefit his performance one iota but I can sure see how it would hurt.
I really hope they trade this guy. I’ve been a huge supporter and I was really happy with how he played when he came back up but his bat disappeared again in the playoffs. Tired of the inconsistency from him. With that much talent he should easily be batting .290 with around 30 home runs a year. I think he needs a change of scenery. Trade him to the white sox or tigers.
A lot of bats disappeared in the playoffs. It would be shorter list to count the ones that did not.
I could see the Tigers looking into Puig. They seem to want to get younger/cheaper. Would they deal J.D. Martinez’s one year of control for two years of Puig?
I like the sound of that. It fills a need and takes Martinez away from the Giants.
I’d love to the Rangers try to make a deal for him. Mazara could play left, Puig in right. Then we’d hope DeShields could turn things around and be at least sort of MLB worthy on offensive and play center. Choo could DH and play a little outfield.
They aren’t going to just give Puig away. So I don’t really see the Dodgers and rangers as a match!