Arbitration Breakdown

Arbitration Breakdown: Marcell Ozuna and Jose Abreu

By Matt Swartz | January 10, 2018 at 6:38pm CDT

Recently, I have been discussing some of the higher-profile upcoming arbitration cases as part of MLBTR’s Arbitration Breakdown series. I rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong. Full arbitration projections for 2018 are also available, for those interested.

Before Marcell Ozuna reports for his first Spring Training as a Cardinal, he will have to start the potentially uncomfortable process of salary arbitration with them. Ozuna has quite a resume to boast, which is part of what made him so attractive to the Cardinals in the first place. He hit .312 with 37 home runs and 124 RBIs last year, giving him few comparables among second-time arbitration-eligible players.

My model projects a substantial raise for him of $7.4MM — all the way to a $10.9MM salary. This may be high, given the lack of exact historical comparables and the potential for an arbitration process to discount some of the home runs hit in a very high league home run environment (2017 set a record). That said, it still suggests that Ozuna is going to get a large raise anyway.

Jose Abreu had a comparable season, and his projection is accordingly similar. He hit .304 with 33 homers and 102 RBIs, making the primary difference in their cases the lower RBI total for Abreu. The White Sox slugger is projected for a $7.1MM raise instead of Ozuna’s $7.4MM, but he starts from a higher base salary and is therefore projected to land at $17.9MM.

No other players in the past five years have entered arbitration with the elusive .300/30/100 slash line. However, several players did so in the prior five years, including Jacoby Ellsbury in 2012 (.321/32/105), Josh Hamilton in 2011 (.359/32/100), Matt Holliday in 2008 (.340/36/137) and Miguel Cabrera in 2008 (.320/34/119). Those players got raises between $5.65MM (Ellsbury) and $3.9MM (Cabrera), although both Hamilton and Holliday got raises above $5MM, thus making Cabrera the exception.

It seems quite likely that Ellsbury, with 39 stolen bases to Ozuna’s one stolen base, would have a better case. However, the fact that Ellsbury’s case is six years old could put them closer together and could even put Ozuna and Abreu ahead. One thing that is important to note is that only Ellsbury got a one-year deal. The other raises mentioned above are part of multi-year deals, which are usually not very applicable in arbitration cases (although they could be in this scenario with few comparables).

If we look for a player more recent, we might consider Manny Machado last year at .294/37/96. He got a $6.5MM raise and clearly looks like a relevant player. The home run environment difference in just one year is pretty limited as well.

The record raise for a second-time eligible hitter belongs to Chris Davis, who got a $7.05MM raise after his .286/53/138 campaign in 2014. That would probably compare favorably to Ozuna’s numbers because of the home run difference, but the four years’ lag could render that number stale and push Ozuna and Abreu above him after all, as the model predicts. However, I think it may serve as a ceiling, leaving Ozuna and Abreu south of theor projections and slightly south of Davis.

Charlie Blackmon hit .324/29/104 last season, but did so in Coors Field, so he might be seen as less impressive than Ozuna and Abreu. His $3.8MM raise is probably a floor, and perhaps not that close of one.

I think it may be more likely that Ozuna and Abreu both get raises somewhere around $6MM. The triad of players with .300/30/100 slash lines and raises over $5MM back in 2008-12 are probably floors, whereas Davis’ raise seems like a ceiling. If that proves true, Ozuna might end up around $10MM instead of closer to $11MM, and Abreu might end up closer to $17MM than $18MM.

Photos courtesy of USA Today Sports Images.

Arbitration Breakdown: Khris Davis

By Matt Swartz | January 5, 2018 at 6:33pm CDT

Over the next few days, I will be discussing some of the higher profile upcoming arbitration cases. I rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong. 2018 projections are available right here. We have already covered Manny Machado’s arbitration breakdown and Mookie Betts’s arbitration breakdown. Full 2018 projected arbitration salaries for every player are also available here at MLBTR.

Khris Davis is projected for a healthy raise of $6.1 million up to an $11.1 million salary due to his impressive 43 home runs this past year. With 110 RBI, but only a .247 average, the main case for Davis getting a big raise is definitely those home runs.

Home runs are notoriously important for arbitration, and are by far the main driver (along with playing time) of raises according to my model. However, this past season set a league record with 6,105 total home runs—this was 26 percent higher than the average from the last five years. So when I look at players with similar totals over the last five years, it is unclear whether an arbitration panel (or teams and agents that are negotiating in the shadow of what an arbitration panel would say) would treat home runs from Davis as similar to other players with the same number as home runs, or as someone with maybe 26 percent fewer home runs. My model does not adjust for league run environment in this way; in general the data has shown that run environment is not a big consideration in arbitration. Hitters in high scoring years benefit from being compared to hitters in lower scoring years, and pitchers in low scoring years benefit from being compared to pitchers in high scoring years.

Deflating Davis’ home run total by 26 percent would put him at 34 home runs, so it would still be a solid season. Chances are that a panel would view Davis as closer to a 40-homer guy (as would Davis’ reps and the A’s during negotiations in the shadow of how a panel would treat him), especially because the Oakland Coliseum deflates home runs, somewhat neutralizing the effect of the higher home run environment.

Only three guys entering their second years of arbitration have hit 40 home runs in the last five years: Two years ago, Josh Donaldson entered arbitration with a .297 average, along with 41 home runs and 123 RBI. His case seems superior to Davis’, mainly because of the fifty point batting average advantage. Thus, Donaldson’s $7.35 million raise seems like a likely ceiling for Khris Davis. Going back four years, we see homonym comparable Chris Davis getting a $7.05 million raise with 53 home runs and a .286 average, along with 138 RBIs; he seems like a ceiling as well. Nolan Arenado hit 41 home runs going into arbitration last year, but he also had a very high average (.294), so his $6.75 million raise seems like a ceiling too. So it is likely that the model is right to place Davis closer to $6 million than $7 million.

It is tough to find floors, but a couple potentials are Lucas Duda and Brandon Moss. Both hit in the .250s but with only 30 home runs, and got raises around $2.5 million. They are clearly well below where Davis should end up.

There is a large range of possibilities there. I think the model is probably as good a guess as any on this case, and I would look for Davis to land around $11 million. But I would probably think $10 million is more likely than $12 million based on the precedent from players like Arenado, Donaldson, and Chris Davis.

Arbitration Breakdown: Mookie Betts

By Matt Swartz | January 5, 2018 at 9:42am CDT

Over the next few days, I will be discussing some of the higher profile upcoming arbitration cases. I rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong. Last night, we kicked off the series with Manny Machado’s arbitration breakdown. Full 2018 projected arbitration salaries for every player are also available here at MLBTR.

Mookie Betts brings a rare combination of speed and power to his first year of arbitration eligibility, making his case a tricky one to project. The model places him at $8.2 million, which seems likely to be too high. The model tends to notice that having solid numbers in multiple statistical categories can aggregate up to a larger effect than the sum of its parts, but this can also lead to overly aggressive projections in some cases. With Betts entering arbitration with the rare combination of 78 career home runs and 80 stolen bases thus far in his young career, the arbitration model may exaggerate that combined effect.

The last time a player entered arbitration with both 60 homers and 60 steals in his career was 2010, when Matt Kemp did it. Hanley Ramirez also did in 2009. However, both signed multi-year deals without exchanging arbitration figures, so they may not be relevant comparables when examining Betts. For what it’s worth, they got $4MM and $5.55MM, respectively, in their first years as part of their multi-year deals. However, this is of limited value, especially given how stale these salaries are.

No one in the past five years with 70 career home runs going into arbitration has had more than 32 stolen bases, and no one in the past five years with 70 career stolen bases going into arbitration has had more than 59 home runs. The latter player was Drew Stubbs, but his .213 platform average and .241 career average, along with just 14 of those home runs coming in his platform season, combine to make him a poor comparable. His $2.83MM salary is well short of where Betts will end up.

If we want to look only at platform year stats, when Betts had 24 home runs and 26 stolen bases, Manny Machado seems like a plausible comparable. He had 35 homers and swiped 20 bases when entering arbitration for the first time two years ago, leading to a $5MM salary. However, he only had 10 stolen bases in his career prior to his platform season, so Betts could argue that he should top this. He also has 10 more career home runs than Machado had at the time and a higher career average (.292 versus .281). Of course, his platform year average of .264 is well short of Machado’s .286. I could see the Red Sox pushing down on his Betts’ salary by suggesting Machado as a comparable.

To get anywhere near the $8.2MM projection, Betts’ agents will need to hit on the fact that Betts’ 2016 performance nearly won him an MVP Award. Players with that type of hardware, such as Buster Posey ($8MM in 2013) and Ryan Howard ($10MM in 2008) stand atop the list of highest first year arbitration salaries. Betts did get 9 of 28 first place votes, with the other 19 and the award itself going to Mike Trout. Admittedly, however, I think such an argument would be a tough sell.

In all likelihood, Betts end up closer to Machado’s $5MM, but somewhat extra for the stronger career totals. I would guess the model falls a couple million short in this instance, as Betts ends up with a first-time arbitration salary around $6MM.

Photo courtesy of USA Today Sports Images.

Arbitration Breakdown: Manny Machado

By Matt Swartz | January 4, 2018 at 8:23pm CDT

Manny Machado had an off year this past season. His .259 average was well below his .284 career number. Unlike many other players this past season, he did not even set his personal home run record. He only had 33, slightly less than his totals for 2015 and 2016. However, with 95 RBI and 9 SB to tack onto his totals, Machado is projected for a $5.8 million raise up to a total salary of $17.3 million.

Part of the problem with determining the accuracy of the model in Machado’s case is something that will affect a great number of cases this year—the high home run level in the league. This past season set a league record with 6,105 total home runs—this was 26 percent higher than the average from the last five years. So when I look at players with similar totals over the last five years, it is unclear whether an arbitration panel (or teams and agents that are negotiating in the shadow of what an arbitration panel would say) would treat home runs from Machado as similar to other players with the same number as home runs, or as someone with maybe 26 percent fewer home runs. My model does not adjust for league run environment in this way; in general the data has shown that run environment is not a big consideration in arbitration. Hitters in high scoring years benefit from being compared to hitters in lower scoring years, and pitchers in low scoring years benefit from being compared to pitchers in high scoring years.

For example, Chase Headley in 2013 is probably a decent comparable, even if his case is a little stale. He hit 31 HR with 115 RBI and batted .286, which bests Machado in AVG and RBI, but is similar to his HR total. With a $5.1 million raise, which would probably be somewhere between $6 and $6.5 million if we adjust for salary inflation, Headley could serve as a solid analog to Machado. However, if we think of Machado’s 33 HR as more like the equivalent of 25 HR in 2013, then Machado should clearly get less than Headley’s inflation-adjusted raise.

If we want a more recent comparable, we might want to consider Todd Frazier last year, who hit .225/40/98. With the league only experiencing a nine percent increase in HR relative to last year, Frazier might be a more legitimate comparable. He clearly had more HR, but a worse average. He only got a $3.75 million raise, which may suggest that the $5.8 million raise projected for Machado is too high.

Eric Hosmer hit .266/25/104 last year, so he could be a solid comparable as well. He received a $4 million raise, again far less than Machado’s projection. Of course, Hosmer is probably a floor with similar AVG and RBI and notably fewer HR. So maybe we want to consider Machado getting something north of $4 million.

I think it makes sense to view Hosmer’s raise as a floor on Machado, especially because of the large difference in defensive skill. While defense does not appear to make a big impact on arbitration at the model level, it obviously can in some cases. I would guess that it helps Machado move towards a raise closer to $5 million. That would still fall short of his projection, but probably puts him in striking distance of somewhere around $16-17 million.

Arbitration Breakdown: Zach Britton

By Matt Swartz | January 12, 2017 at 8:22pm CDT

Over the last few days, I have been discussing some of the higher profile upcoming arbitration cases. I rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong. 2017 projections are available right here.

Zach Britton had a phenomenal 2016 campaign for the Orioles, logging 47 saves and a 0.54 ERA over 67 innings while striking out 74 batters. As a result, the dominant sinkerballer is projected for a $4.65MM raise, from $6.75MM to $11.4MM. It is rare to find a season as dominant as Britton’s 2016, so it is not surprising that he is projected to get a raise bigger than Mark Melancon’s record $4.25MM raise last year for a third-time-eligible reliever.

Melancon saved 51 games in his platform season, four more than Britton, but his 2.23 ERA is far less impressive than Britton’s 0.54. His 62 punchouts also fell shy of Britton’s 74. Therefore, his $4.25MM raise is a plausible floor for Britton already. Britton besting this by $400K, as the model expects, seems reasonable.

Jim Johnson in 2013 got a $3.88MM raise, the second highest for a third time eligible reliever behind Melancon. He had 51 saves and a 2.49 ERA, so he also meets the criteria of logging a few more saves than Britton while posting a decidedly worse ERA.

However, since Melancon did save four more games, it is worth looking to see if guys with low ERAs but slightly fewer saves did any worse than Melancon did. Looking for guys with ERAs under 2 that were closers, no names emerge in the last five years other than Aroldis Chapman, who had 33 saves and a 1.63 ERA, but only got a $3.27MM raise. Clearly, every aspect of Britton’s case is much stronger than was Chapman’s, so this is not too concerning.

Heath Bell in 2011 is probably a stale comparable, although he did have a sub-2 ERA (he posted a 1.93 ERA) and he matched Britton’s 47 saves exactly. His $3.5MM raise would almost certainly be a floor for Britton as well.

Putting it all together, there is little reason to use any comparable other than Melancon here. All other potential third-time eligible relievers got smaller raises and had worse performances. Britton should easily clear Melancon’s $4.25MM number, and the model’s $4.65MM projected raise seems as reasonable as anything. Because Baltimore is now moving to a “file-and-trial” approach, though, the stakes are raised as the sides try to work out an agreement on the heels of Britton’s historic season.

Photo courtesy of USA Today Sports Images.

Arbitration Breakdown: Nolan Arenado

By Matt Swartz | January 8, 2017 at 5:51pm CDT

Over the next few days, I will be discussing some of the higher profile upcoming arbitration cases. I will rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong

Rockies third baseman Nolan Arenado earned $5MM last year, but after belting 41 home runs, knocking in 133 runs and hitting .294 in 696 plate appearances, he is due for a hefty raise. The record raise for a second-time-eligible position player on a one-year deal is Chris Davis’ $7.1MM increase in 2014. My model actually projects for an $8.4MM raise in Arenado’s case; however, the “Kimbrel Rule” – which states that no player gets projected for an increase over $1MM higher than the record raise for his service class – moves Arenado down to an $8.1MM raise (a $13.1MM salary).

Davis’ 2014 case is by far the most applicable to Arenado’s. Aside from those two, no other player eligible for his second year of arbitration has led his league in home runs and RBIs. Davis hit .286 with 53 homers and 138 RBIs the prior year, so his numbers are similar except for clearly having more HRs. However, Arenado does play a harder defensive position than Davis, a first baseman, and the former actually won a Gold Glove last year. So there is a good reason to think that Arenado could earn more, especially three years later. But the 12 fewer home runs signify that it is less than a sure thing.

Finding another comparable is extremely difficult. No other third basemen since 2009 have even hit 20 home runs and received one-year deals in their second year of arbitration eligibility. No other position players have hit at least 35 home runs and received one-year deals in their second year of arbitration eligibility.

Using players receiving multi-year deals is generally not customary in these cases, but can be done in some unique circumstances. Often when both the player and the team exchange numbers, the club’s offer can be seen as a potential comparable case. Josh Donaldson’s case last year could be one such scenario. Donaldson hit the exact 41 home runs that Arenado did this past year, and knocked in 123 runs (just 10 shy of Arenado’s total). He also hit .297, which is almost exactly where Arenado landed. Donaldson ultimately received a multi-year deal, but he first exchanged figures with the Blue Jays, who offered a $7.05MM raise. Donaldson’s two-year deal gave him a $7.35mM raise. He did win the MVP in his platform year, so that could be a better case, but the multi-year deal probably makes it a weaker comparable. On the other hand, Donaldson only requested a $7.5MM raise, so it would be hard to see why Arenado would get more without an MVP award.

I would guess that Arenado ultimately receives closer to a $7MM raise than the $8.1MM he is projected to land. Davis’ extra home runs and Donaldson’s MVP award help their cases look stronger than Arenado’s, and even though Donaldson got a multi-year deal, his exchange of salary figures with the Jays fit into a pretty tight window. Arenado may argue that Donaldson’s case is not applicable, and that Davis’ extra home runs came with less defense, but it might not work. Although fielding is certainly considered in arbitration cases, I have not found any statistically significant impact of defense on earnings and the overall effect is limiting. Arenado may yet earn his lofty projection, but I would take the under.

Photo courtesy of USA Today Sports Images.

Arbitration Breakdown: Jake Arrieta

By Matt Swartz | January 8, 2017 at 10:10am CDT

Jake Arrieta enters his third and final year of arbitration this winter with a hefty $10.7MM base salary following his 2015 Cy Young Award season. While his 2016 campaign was less stellar, Arrieta still posted a very respectable 3.10 ERA in 197.1 innings, along with an 18-8 record and 190 strikeouts. As a result, my model projects him to get a $6.1MM raise and earn $16.8MM for 2017.

Finding comparable pitchers to Arrieta’s platform season is tricky. His $6.1MM raise would be the second-highest ever for a third-year eligible starting pitcher — Max Scherzer got an $8.8MM raise after his Cy Young Award-winning season three years ago. Scherzer’s 21-3 record, 2.90 ERA, 214.1 innings and 240 strikeouts (plus the Cy Young Award itself) combine to put an obvious ceiling above Arrieta. There is no way Arrieta is going to get anywhere near Scherzer’s $8.8MM raise, but where the Cubs ace falls below that number is difficult to discern.

Aside from Scherzer, the next highest raise in this service class (excluding the anomalous and stale case of Carlos Zambrano in 2007) belongs to Jeff Samardzija, who got a $4.46MM raise in 2015. Samardzija posted just a 7-13 record that season, but with a 2.99 ERA in 219.2 innings to go along with 202 strikeouts. While Arrieta’s 2016 season fell twenty innings short of Samardzija’s 2014, Arrieta’s 11 extra wins suggest he should easily top Samardzija’s raise.

Doug Fister in the 2014-15 offseason could be an interesting comparable because his win total is more applicable to Arrieta’s case. Fister received a $4.2MM raise after winning 16 games in 2014. Fister’s 2.41 ERA bested Arrieta’s mark from this past season, though Arrieta significantly outpaced Fister in innings (197.1 to 164) and strikeouts (190 to 98). Alfredo Simon got a $4.05MM raise that same year with 15 wins and 196.1 innings, but his 3.44 ERA is less impressive than Arrieta’s, and his 127 strikeouts are far weaker too.

One plausible comparable could be Justin Masterson, who got a $4.07MM raise after a strong 2013 campaign — 14-10 record, 3.45 ERA, and 195 strikeouts in 193 IP. While the innings and strikeouts are a reasonable comparison, the record and ERA are clearly a step behind Arrieta.

Overall, we see a very obvious ceiling at $8.8MM with Scherzer way above Arrieta, and a series of pitchers in the low $4MM-raise range that clearly represent a floor. Where Arrieta lands is a mystery, but it would surprise me if he achieved the $6.1MM raise as projected by the model. I think a $5MM raise makes a lot of sense based on these comparables, and maybe $5.5MM since he clearly has a much better case than all of the $4MM-raise pitchers, though $6.1 million seems a little too high. Look for Arrieta to land somewhere closer to $16MM in 2017 than the nearly $17MM the model expects.

Arbitration Breakdown: Manny Machado

By Matt Swartz | January 7, 2017 at 10:48pm CDT

Over the next few days, I will be discussing some of the higher profile upcoming arbitration cases. I will rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong.

Manny Machado enters his second year of arbitration eligibility with a $5MM base salary and a strong case for a solid raise. My model projects him to reach $11.2MM, good for a $6.2MM raise, after an All-Star campaign with a .294 batting average, 37 home runs and 96 runs batted in. The model is a useful tool here, and probably came up with a reasonable guess, because so few comparables are appropriate for Machado’s platform year.

Position players like Machado generally receive multi-year deals in lieu of one-year pacts once they reach their second year of arbitration. In the last decade, only 10 players have hit at least .280 and belted 30 homers going into their second year of arbitration eligibility, and a full seven of those 10 received multi-year deals before reaching agreement on a single-year number.

Only two of those cases have occurred since 2007 – Jacoby Ellsbury in 2012 and Chris Davis in 2014. Ellsbury received a $5.65MM raise, while Davis’ salary grew by a full $7.05MM. Both players had better platform years than Machado. Ellsbury hit .321 with 32 home runs, 39 stolen bases and 105 RBI. Davis hit .286 with 53 blasts and knocked in 138. Ellsbury’s case is probably stale, however (it is now five years old), so even though he only received a $5.65MM raise there is reason to expect Machado could eclipse that number. Davis’ case is only three years old, and it’s harder to argue that Machado should get a bigger raise. The model, in fact, does not believe this to be true.

With Ellsbury’s case stale and Davis’ looking more like a ceiling, it makes sense to look for a floor for Machado. But it is difficult to find one. In the last three years, no other second-year-eligible player has received a single-year deal with a raise larger than the $2.77MM that Daniel Murphy received. But Murphy had only clubbed 13 homers and hit .286. While he had stolen 23 bases, he only knocked in 78 runs. Clearly Machado should get a far larger raise than Murphy.

Going back further, Hunter Pence in 2011 is a longshot possibility for a floor. He received a $3.4MM raise after posting a .282/25/91 line. Pence’s case was clearly inferior, and the six-year gap between his case and Machado’s certainly makes him a floor.

It’s clear that Machado is likely to earn less than Davis’ $7.05MM raise, but he’s also likely to get more than Pence’s $3.4MM increase. There is an argument that Machado should earn less than Ellsbury’s $5.65MM raise, but given the five-year lag between the two cases, that may not be applicable anyway. I suspect that the model’s $6.2MM projected raise is as a reasonable of an estimate as we can expect for Machado’s unique situation. It falls short of Davis, but with Machado playing better defense at a harder position, he probably will not fall all that far short despite the significant gap in power numbers.

Photo courtesy of USA Today Sports Images.

Arbitration Breakdown: Todd Frazier & Eric Hosmer

By Matt Swartz | January 7, 2017 at 3:58pm CDT

Over the next few days, I will be discussing some of the higher-profile upcoming arbitration cases. I will rely partly on my arbitration model developed exclusively for MLB Trade Rumors, but will also break out some interesting comparables and determine where the model might be wrong.

Two corner infielders, Todd Frazier and Eric Hosmer, enter arbitration this offseason after completing two-year deals that paid them each $8.25MM in the latter year (including a prorated portion of Frazier’s signing bonus). Both had solid years as power hitters, and my model projects each to receive a raise of $5.25MM for Frazier and $5.05MM for Hosmer, to $13.5MM and $13.3MM, respectively).

Only ten position players in the past decade have received additional single-year salaries through arbitration after receiving multi-year deals earlier in their eligibility. Most of these players had poor seasons, and only five of these ten have met these criteria since 2009.

As a result, it’s difficult to find good comparables for the situations in which Frazier and Hosmer find themselves. Perhaps the best match would be Prince Fielder, who received a $4MM raise in 2011 after a solid season in which he batted .261 with 32 homers and 83 RBIs. Frazier actually had more home runs last season but a worse average, posting a .225/40/98 line with 15 steals, while Hosmer was very similar at .266/25/104.

It’s rare for six-year old cases to be used in arbitration hearings, so Fielder is probably not a great match. However, applying some salary inflation to his $4MM raise suggests the model’s projections for Frazier and Hosmer are probably somewhat reasonable.

We can also check if players going to arbitration following multi-year deals fare better or worse than players who have been going year to year, and the evidence here suggests looking for regular comparables among the year-to-year group is reasonable. The average raise for the ten players coming off multi-year deals was $1.6MM, compared to projected earnings of $1.5MM. This difference is not significant enough to worry about a systematic bias. Therefore, looking for comparables in the year-to-year group makes sense to pin things down more precisely.

Of course, it is rare for power hitters to go year to year at all, so few players emerge as possibilities. No one in the last three years has entered their third or fourth year of arbitration eligibility coming off a platform year with 20 home runs and 90 runs batted in. A couple players did so in 2013, including Chase Headley, who received a $5.1MM raise after a .286/31/115 campaign with 17 steals. Hunter Pence only got a $3.4MM raise after his .253/24/104 campaign the year prior. Pence could prove a reasonable comparable for Hosmer’s .266/25/104, which suggests Hosmer’s $5.05MM projected raise is probably high. However, Headley clearly did not do all that much better than Hosmer in his platform year, and both cases are old, so it remains possible that Headley is the better comparable and a $5MM raise is reasonable.

Frazier’s case is tricky in that no one in the last decade has entered their third or fourth year of arbitration eligibility with a batting average below .260 and at least 30 home runs. Although Frazier’s batting average was much poorer, I have found that batting average is a somewhat less important criteria than ran home run totals in arbitration, so I believe Frazier’s case is strong. I think Headley’s 60 points of batting average probably roughly offset the nine fewer home runs, and a $5MM raise or slightly higher does seem more believable for Frazier.

Three players in the last decade have gotten $5MM raises as part of multi-year deals—Jose Bautista, Carlos Pena, and Matt Kemp. However, none of them are great comparables, since they all had much better numbers than either Frazier and Hosmer. Additionally, multi-year deals are generally not used in arbitration hearings, although they may be in these instances where comparables are tough to find.

Ultimately, I think both Frazier and Hosmer have good cases to top Fielder’s $4MM raise and either could make a case for being near Headley’s $5.1MM raise. I suspect Hosmer may fall short of his projected $5.05MM raise, and get somewhere closer to $4.5MM—which would put him around $12.75MM. Frazier’s 40 home runs allow for more upside, and his $5.25MM projected raise to $13.5MM seems like a reasonable estimate.

Arbitration Breakdown: Addison Reed

By Matt Swartz | January 7, 2017 at 9:30am CDT

Modeling arbitration salaries is an inexact science, and sometimes “inexact” is too generous of a description. Setup man Addison Reed’s projected $5.3MM raise to $10.6MM is clearly one of those times. Even worse is that the model was only saved by the “Kimbrel Rule,” which states that a player can only beat the record salary for their service class by $1M in the model. The raw model projected a $5.8MM raise. Reed is going to get a far smaller raise than he projected, because the peculiarities of his case confuse the model so much.

Reed’s case is unique because he has 106 career saves but had 40 holds this year in lieu of working as a closer. Further, he struck out 91 batters in 77.2 innings while posting a microscopic 1.97 ERA. Relievers who have a career of closing success behind them tend to out-earn those who have a single good year as closers. So the model gives credit to career save totals, which boosts Reed’s projection significantly.

He is, however, unlikely to get extra credit for those saves in real life. Remove those career saves, and the model projects him for a $3.6MM raise. That’s still large, but much more reasonable.

Reed’s 40 holds this year put him in elite company on their own. In the last decade, only three relievers entering their third year of arbitration eligibility have even accumulated 30 holds—David Robertson in 2014, Tyler Clippard in 2014, and Mike Adams in 2012. They had 33, 33, and 32 holds, respectively, and earned raises of $2.12MM, $1.88MM, and $1.87MM. Their ERAs were strong as well: 2.04, 2.41, and 1.47, as compared with Reed’s 1.97 ERA total. The extra holds suggest Reed’s raise will be worth significantly more than Robertson’s $2.12MM.

That establishes a floor for Reed, but looking for a ceiling is tricky with a lack of relievers amassing 40 holds or anything near it. To find a potential ceiling, we can look to closers who pitched similarly. Among closers who had ERAs under 2.00 like Reed, only one name emerges from the last five years—Aroldis Chapman. He had 33 saves and a 1.63 ERA in 2015, with 116 strikeouts in 66.1 innings. Chapman got a $3.27MM raise. Although Reed had seven more holds than Chapman did saves, he had a higher ERA and fewer strikeouts.

Putting this together, it makes sense that Reed should fall somewhere between a $2.12 and $3.27MM. I suspect right in the middle at $2.7MM would make sense, putting him at $8MM. It is a far cry from the model’s $10.6MM projection ($11.1MM ignoring the Kimbrel Rule), but it definitely would be a healthy raise for Reed’s third year of eligibility.

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