Justin Masterson and the Indians are WAY far apart on arbitration figures

Tom Szczerbowski-US PRESSWIRE

The Indians and their top pitcher from the last three years find themselves with a wide gulf between their arbitration offers.

Friday was the deadline for arbitration-eligible MLB players and their teams to submit their offers for the arbitration process. Marc Rzepczynski and Josh Outman have already agreed to deals, but Justin Masterson, Michael Brantley, Vinnie Pestano, and Josh Tomlin have not.

MLB will now begin scheduling hearings throughout the first three weeks of February, and if a team and player still haven't agreed to something by the time their hearing rolls around, each side presents its case to an arbitration panel, which then chooses one of the salary bids or the other, never something in between.

Most teams very rarely actually let things get to a hearing with their players. In fact, there wasn't a single hearing in all of MLB in 2013, and the Indians haven't been involved in a hearing since 1991, when they won a hearing against Jerry Browne and lost one against Greg Swindell. The stage in the process that was reached on Friday means there are now public figures floating out there, and the vast majority of the 40 MLB players who submitted figures on Friday will end signing deals for something very close to the middle of the two sides' bids.

Tomlin submitted a bid of $975,000, which is the lowest by any of those 40 players. The Indians submitted a bid of $800,000. Pestano submitted for $1.45 million, while the team is at $975,000. Expect both those players to compromise on something very near the midpoint of their offer and the team's.

Brantley is a different story. His bid is $3.8 million, while the team's is $2.7 million. If I were Brantley, I wouldn't move much from my original bid in negotiations between now and the hearing. Of the 8 bids for the 4 players listed here, the one made by Brantley's side is easily the one I am most confident an arbitrator would choose at a hearing. He's been an above average player for three years in a row, and before yesterday I'd have guessed that the middle point between the two sides' bids would be ~$3.8M. There's always incentive for both sides to avoid a hearing, not only because of the financial risk, but because a hearing will necessarily involve the team's lawyers arguing that a player isn't as good as he thinks he is, while the player sits there listening, potentially damaging the relationship between the two sides. In this case though, I think Brantley should hold out for something far closer to his bid, or go to the hearing. I wouldn't accept less than $3.5M if I were him.

Then there's Masterson. His bid is $11.8 million. The Indians bid is only $8.05 million, putting the two sides $3.75 million apart, easily the biggest gap between any of the 40 players who submitted a bid and their team. Now, the larger the figures involved, the larger the expected difference should be, you're not going to have a player bid $5M and a team bid $1M, but when you look at the difference as percentage, you see that Masterson is looking for nearly 50% more than the Indians are offering, which is a wide gulf.

Choosing a figure to submit is a delicate business. If a player submits too high a bid, he leaves himself vulnerable to the team feeling little obligation to negotiate any further. The same is true to some extent if team submits far too low a bid, but because the difference in figures is always going to be more significant to a player's finances than to a team's, there is more incentive for a player to avoid a hearing, because the risk is relatively greater to him.

Unlike the Brantley case, where one side (his) is far closer to what I would have expected the negotiated deal to end up at, in this instance the middle point between the two sides, $9.925 million is right around what I've expected him to earn. If I had to pick a side that I think has overreached though, it would be Masterson's. His bid is more than twice as much as he earned in 2013 ($5.688M), and few players see that kind of raise between their second and third years of arbitration eligibility (The team's offer represents a 50% raise).

Masterson pitched well in 2014, but his run prevention is good, not great, and he suffered an injury near the end of the season and has only pitched in relief since then (I'm not concerned about his ability to start, but the injury is certainly not a point in his favor). Also, the record for the highest salary ever awarded by an arbitration panel is $10 million, so if the two sides do go to a hearing, Masterson would be looking to break that mark by almost 20%.

For those reasons, I have a very hard time seeing Masterson's advisors allowing this to go to a hearing. I think the team has a bit more leverage, and now expect the final landing spot to be something a bit under that middle point, ~$9.7 million. This was probably always going to be where they landed if they went for a 1-year deal, and the wider than perhaps expected gulf will prove not to matter much.

Negotiating a compromise between the two offers for 2014 is not the only option though, as the two sides could also work out a longterm extension.

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