- Major League Baseball introduced its economic proposal to its players union on Tuesday.
- Under the MLB's plan, the highest-paid players could lose about 80% of their salaries.
- MLB says the plan reflects the projected losses the league expects this year after it was forced to delay the start of its season due to the coronavirus pandemic.
Major League Baseball moved ahead with its return to play presentation, introducing its long-awaited economic proposal to its players union on Tuesday as the league works to start its delayed season this summer.
Under the MLB's plan, the highest-paid players could lose about 80% of their salaries, while players making the least amount could keep up to 90% of their pay. The plan calls for players to retain their salary via a tier system. In short, the more a player is scheduled to earn for the 2020 season, the less he retains under the plan.
The plan says players making in the range of $563,501 to $1 million can keep more than 70% of their pay. That number decreases to only 50% for salaries in the $1 to $5 million range, 40% in the $5 to $10 million tier and players making more than $20 million per year could only keep 20% of their salaries.
The revenue-sharing plan is already receiving push back by the Major League Baseball Players Association (MLBPA), and some players have expressed concern about the system on social media.
In a statement, the MLB called the proposal "consistent with the economic realities facing our sport. We look forward to a responsive proposal from the MLBPA," the league said.
The plan also called for players to share $200 million in postseason bonuses, which includes $125 million for players who compete in the World Series. The MLB's first economic proposal is only the start of what promises to be a long negotiation period to resume play suspend by the Covid-19 pandemic.
Tom Ricketts, chairman and co-owner of the Chicago Cubs, told CNBC's "The Exchange" on Tuesday that the MLB projects it will lose $4 billion if games are played without fans.
"That's particularly hard on teams like the Cubs," said Ricketts, adding the "game day activities" account for 70% of MLB's revenue. "In the best case scenario, we're looking at recovering maybe 20 percent of our total income. So, that is where the rub is and that is where the discussion will go with the players over the next few weeks."
Team owners ratified an economic plan on March 27, which includes a total of $170 million and options to reformat the postseason. On May 13, the MLB introduced Phase 1 of its presentation to the MLBPA that addressed safety and health protocol in a 67-page document.
"Hopefully that will get to the point where everyone is comfortable with it," Ricketts said.
The plan also calls for games to be played in home stadiums with no fans or partially filled parks that follow social distancing guidelines. Other parts of the MLB's proposal would change team schedules to eliminate long-distance travel.
The new format calls for division opponents to compete more throughout the season, and regional play would include teams from the opposite league.