While there are many issues that are plaguing baseball, such as the manner in which talent is acquired internationally, two members of the United States legislature have moved to protect the paltry minor-league pay scale. Justin Gorman looks into Congress engaging in minor league meddling and finds some unsurprising evidence.
In a press release issued today by MiLB.com’s Jeff Lantz, the institution of Minor League Baseball voiced their “full support” for the “bipartisan Save America’s Pastime Act,” otherwise known as H.R. 5580. For the duration of this article, this piece of legislation shall be referred to as its number, as both its name and MiLB’s description are patently misleading.
H.R. 5580 was introduced to the House of Representatives on June 24, 2016, co-sponsored by Republican Congressman Brett Guthrie of Kentucky and Democratic Congresswoman Cheri Bustos of Illinois[Editor’s Note: Rep. Bustos withdrew her support from H.R. 5580 on June 30, 2016]. The legislation would amend 29 U.S. Code §213 (known as “Section 13”) of the federal Fair Labor Standards Act (FLSA) to add “any employee who has entered into a contract to play baseball at the minor league level” as an exemption. On its own, Section 13 provides a list of, currently, 12 employment situations that would not be subject to the provisions of 29 U.S.C. §206 (Minimum Wage Requirements) and 29 U.S.C. §207 (Maximum Hour Requirements).
The Representatives from Kentucky and Illinois – who so bravely crossed party lines to propose this piece of legislation – did so in response to a pending federal lawsuit in California, Senne v. Office of the Commissioner of Baseball, where thousands of current and former minor league baseball players are named Plaintiffs alleging violations of the FLSA and various state labor laws. H.R. 5580, which can be seen in full-text form here, is very straightforward. Under Section 13 of the FLSA, there are currently 12 categories of employee that are exempt from receiving overtime and/or minimum wage, and these two members of Congress wish to make minor-league baseball players the 13th. (Note: The Bill proposes creating a 19th subsection; subsections 2, 4, 9, 11, 13 and 14 have been repealed in the past, but remain as section number references in FLSA). That broad list, including all of its qualifiers and exceptions, can be viewed here.
MiLB’s press release states that “the legislation would amend the [FLSA] to clarify that Minor League Baseball players are not subject to a law that was intended to protect workers in traditional hourly-rate jobs.” The FLSA was originally passed in 1938, established the 40-hour work week, established the federal minimum wage, guaranteed overtime in certain jobs, and prohibited employment of minors to curb “oppressive child labor.” We will revisit the MiLB press release shortly, but an explanation of minor-league salaries and the implications of those salaries are worth covering first.
Minor League Player Salaries
While it is well-known that Major League Baseball players make a lot of money, it is less well-known that Minor League Baseball players do not. According to Jeff Blank’s Sports Law Blog, until a minor-league player is placed on a 40-man roster, monthly salaries are $1,150 for short-season teams, $1,300 for low-A, and $1,500 at High-A. In Double-A, the monthly salary is $1,700 and it goes up $100 a month for each year of service at that level; for Triple-A, a player receives $2,150 a month the first year, $2,400 a month the second year, and $2,700 the third year. Once a minor leaguer is placed on the major-league club’s 40-man roster, his salary increases as long as he remains on the 40-man. Minor-league players are also provided $25 per road day for meals. Blank provides data through 2015, so it is worth noting that there may have been increases for 2016 due to market conditions.
In any event, the data provided is illustrative of the economic condition of the average minor-league player – take, for example, the Boston Red Sox system. Currently, the Red Sox affiliates are AAA Pawtucket, AA Portland, High-A Salem, Single-A Greenville, the short-season Low-A Lowell Spinners, the short-season Gulf Coast League Red Sox, and two short-season Dominican Summer League teams. There are approximately 250 players from top to bottom in the organization, and 43 of those players are listed as part of the 40-man roster (the number exceeds 40 due to long-term injuries).
There are some players beyond the 40-man roster (Rusney Castillo and Yoan Moncada come to mind) who signed large contracts as international free agents. Others still – Andrew Benintendi and Trey Ball among them – were first-round draft picks, and collected signing bonuses commensurate with their draft slot. Still, the vast majority of minor leaguers are making very little money. If we conservatively estimate that each of the 30 major-league organizations has around 250 players, and 150 of those were neither (1) on the 40-man roster nor (2) received any significant signing bonus upon being drafted, then 4,500 players are relying on the above-referenced wages to survive.
Let’s take the example of a player fitting that description from the full-season, Single-A Greenville Drive. Greenville’s regular season began on April 7 and is due to conclude on September 5, a span of 152 days. At the beginning of the season, Greenville was scheduled to play 140 games over the course of those 152 days. That player will collect a salary of $1,300 x five months, or $6,500 for the full year, plus $25 for meals on away days. That equates to $42 per day of being under the employ of their team, which doesn’t sound so bad if the player’s only responsibility is to play a 3-hour baseball game 140 times; but realistically, there are mandatory workouts, practices, community events, PR events, and team activities – not to mention travel time.
If that were extrapolated out to a full year, it would amount to an annual salary of $15,600. The 2016 federal poverty level for individuals is $11,880, $16,020 for a family of two, and $20,160 for a family of three, according to the Department of Health and Human Services.
MiLB Press Release
If we shift back to the MiLB press release, MiLB takes the position that the lawsuit jeopardizes the existence of Minor League Baseball itself. The league goes on to bloviate: “As a result of this lawsuit filed on behalf of thousands of current and former players, many cities would be in jeopardy of losing their Minor League baseball teams, resulting in the elimination of tens of thousands of jobs nationwide, shuttering tax-payer (sic) funded ballparks and creating a void in affordable family-friendly entertainment.”
Each and every minor-league salary is paid by the multi-billion-dollar major-league franchise that controls its minor-league affiliates. An increase in minor-league wages so that they align with the requirements of the FLSA does not put the existence of Minor League Baseball at risk – at worst, it will cut into the profits of MLB franchises who are currently basking in the luxury of their enormous TV contracts. I presume they look like this:
MiLB quotes Louisville Bats President Gary Ulmer, “Should the California litigation be successful, teams like the Louisville Bats, Bowling Green Hot Rods and Lexington Legends may well disappear.” The Bats are the Triple-A affiliate of the Cincinnati Reds, the Hot Rods are a Single-A affiliate of the Tampa Bay Rays, and the Legends are a Single-A affiliate of the Kansas City Royals. If the thousands of current and former players who filed this lawsuit should prevail, the only way these teams would disappear is if their parent clubs were to significantly shrink their minor-league systems on the basis of not being able to afford player salaries. It is interesting to note that Forbes Magazine ranked the Bats as the fourth most valuable franchise in Minor League Baseball in 2012.
Quad Cities River Bandits owner Dave Heller, quoted as saying that Congresswoman Bustos “understands the importance – both the economic and emotional impact – of Minor League Baseball”, is the president and CEO of Main Street Baseball, LLC. He is the majority owner of five affiliated minor league baseball teams – the River Bandits, the Wilmington Blue Rocks, the High Desert Mavericks, the Billings Mustangs, and the Lowell Spinners. According to his official bio, he is “one of the Democratic Party’s top media consultants and campaign strategists…compil[ing] the best win-loss record in the Democratic Party helping clients win election to Congress.”
The two members of Congress who nobly put aside partisan gridlock to co-sponsor this bill? It will come as no surprise that Rep. Brett Guthrie received $1,000 so far in the 2015-2016 election cycle, in addition to $3,000 from 2013-2014, from Major League Baseball’s Commissioner’s Office’s Political Action Committee. Not to be outdone, Rep. Cheri Bustos has collected $2,000 in 2015-16, along with an additional $2,000 from 2013-14 – sums of money that enable her to understand the emotional impact of minor league baseball – and most certainly the economic impact. Of course, these donations pale in comparison to some of the larger donations each politician has received while constantly seeking re-election, but Major League Baseball has paid them each 62% of a single-A player’s annual salary over the past four years to push their legislative agenda. In total, the Major League Baseball Commissioner’s Office PAC has donated $205,125 combined to members of Congress in the 2016 election cycle alone. While that might be less than half of the major-league minimum salary, that’s 31.5 times the annual salary of a single-A player.
Minor League Baseball should be ashamed of itself for using scare tactics and comically transparent ownership statements to publicize its effort of further stifling minor-league salaries. If the legislation passes and the California lawsuit succeeds, it will just have to be appealed further up in the judicial system, so it’s silly to consider the bill as a quick fix to the already pending federal lawsuit.
Finally, if one were to assume that either MiLB, Ulmer, or Heller’s statements are true, and such an increase in the dismal minor-league player’s salary will sink Minor League Baseball as we know it, then a couple of questions arise: Do the parent organizations of your minor-league clubs agree? And are they threatening to get rid of these teams if salaries have to increase? They do, after all, pay the players’ salaries.
Justin Gorman has written about manager tirades, baseball contracts, an illegal delivery, and the case for expansion.
Follow Justin on Twitter @j1gorman.