SS-Notes, Transactions Primer                                    

Baseball America provided an update of the rules in early 2010

(December 4, 2006, Jonathan Mayo,, on the Rule 5 draft)

Here's the abridged version of the new rule:

A player who is 18 when he's signed can spend five seasons (up from four) in an organization before he has to be protected. Anyone who is 19 or older must be protected after four years (up from three). Once past that length of service, a prospect must be placed on the 40-man roster if his organization wants to keep him from being eligible for the Rule 5 draft.

The draft has three phases. The Major League phase is the one in which Uggla was taken. Any Minor Leaguer who fits the above qualifications is game, at any level. In the Minor League phases, only players left unprotected -- and there are protected lists at each level to consider for these rounds -- can be selected.

While the rules regarding elgibility have changed, the costs have not. At the Major League level, there's a $50,000 price tag to select a player and the team must create space on its 40-man roster to take a player at this level. The fee is $12,000 for the Double-A segment and $4,000 for the Class A draft.

Got it? OK, now here's the main wrinkle. A player taken in the Major League phase of the draft must stay on the 25-man roster all season or be offered back to the original club for half the initial fee.

(October 23, 2006)   MLB and the union announced agreement on a 5-year deal,  Highlights (from

Revenue sharing
• Under the new deal, larger-revenue clubs will continue to transfer $326 million in local revenue to smaller revenue-generating franchises. Net transfer amounts will continue to grow with revenue and changes in disparity.
• Tax rates will be reduced to 31 percent for all clubs.
• Smaller-revenue clubs must continue to invest revenue income to improve the team's on-field performance.
Competitive balance tax
• Levels remain unchanged from the prior contract: 22.5 percent the first time a club exceeds the threshold, 30 percent the second time and 40 percent the third time. Clubs that paid at a 40 percent rate in 2006 will enter new contract at same rate.
• Thresholds reset to $148 million in 2007, $155 million in 2008, $162 million in 2009, $170 million in 2010 and $178 million in 2011.

First-Year Player and Rule 5 Drafts
• Clubs that can't sign their first- or second-round picks will be slotted in for a compensatory pick at the same slot in the following year's draft. Clubs that can't sign a third-round pick will receive a sandwich pick between the third and fourth rounds at the following year's draft.
• Clubs have an Aug. 15 deadline to sign all draft selections except college seniors.
• Minor League players can now be protected from the Rule 5 Draft for an extra year, to four or five years.

Free agency
• Dec. 7, Dec. 19, Jan. 8 and May 1 deadlines are eliminated.
• Date to tender contracts moved to Dec. 12 from Dec. 20.

Free agent compensation
• Type C free agent classification is eliminated.
• Teams that lose a Type B free agent will now earn a sandwich pick instead of taking selection from club that signed player.
• The pool of Type A players shrinks from top 30 percent of each position to top 20 percent, while the Type B player pool will be reduced from the top 31-50 percent of players to 21-40 percent.

Drug policy
• Drug-testing rules will stay unchanged.
• Both sides agreed to further discuss HGH testing in the future.
Minimum salary
• Major League minimum salary will increase to $380,000 in 2007, $390,000 in 2008, $400,000 in 2009 and to a cost-of-living increase in 2011.
• Minor League minimum salary will increse to $60,000 in 2007, $62,500 in 2008 and $65,000 in 2009.

Other highlights
• Players traded in the middle of a multi-year contract no longer have the right to demand a trade. Players who currently hold that right from the last CBA are grandfathered in and can still demand a trade.
• Salary arbitration offer deadline moves to Dec. 1, while the acceptance deadline moves to Dec. 7.
• All-Star Game winner continues to have home-field advantage in World Series.
• There will be no contraction during the term of the agreement
• The Commissioner's discretionary fund will remain at $10 million a year.
• As in the old contract, clubs cannot borrow to pay existing debt but must raise revenue or reduce expenses to pay existing non-player-related debt.

From Baseball America :

" ... One other change to the amateur draft is a uniform signing date of Aug. 15 for all players (other than college seniors), replacing the longtime and clumsy deadline of the moment a player literally attends his first four-year college class. In addition to creating some order for all involved--from teams to players to college coaches wanting an earlier idea of their incoming class--this also eliminates the junior-college, draft-and-follow rule in which players who attended two-year schools could sign with their drafting club until one week before the following draft."

" ... The first-year player draft, also known as the Rule 4 draft, was not the only draft process altered by the new CBA. The major league portion of the Rule 5 draft will be affected by giving teams one extra year to protect players from it. Rather than teams being allowed three years (for players signed at age 19 or older) or four years (for players 18 and younger) before leaving them off the 40-man roster subjects them to the Rule 5 draft, those periods have been lengthened to four and five. Ownership considered this a significant boost in their efforts to operate their minor league systems more effectively."

" ... This rule applies to this current offseason, meaning that many minor league players who had expected to either be placed on the 40-man roster or be subject to the Rule 5 draft will have to wait another year. The union did negotiate a higher minimum salary for 40-man roster players optioned to the minor leagues ($30,000 next year), but acknowledged that this was a significant concession to ownership."

All the notes below, preceded the agreement above :

(From the New York Mets website)


Confused by the difference between Options and Waivers?

Get Your Answers Here!

1. Player Limits

A team's roster may consist of 40 players until Opening Day, when the number must be reduced to 25 until September 1st, when it again becomes 40.

2. Disabled Lists

You often may hear of a player being placed on the 15-day disabled list, but there are actually two disabled lists, the 15-day and the 60-day disabled list. The only difference between the two is that a player on the 60-day disabled list will not count against a team's 40-man roster. This allows a team to keep an extra player on the roster while the disabled player remains out.

A player may only be placed on the disabled list for verifiable medical reasons, that is a player must be certified hurt by a medical doctor.

A player can be placed on the disabled list retroactively for as many as 10 days, beginning with the day after the last game he played.

Any player may be moved from the 15-day disabled list to the 60-day disabled list at any time. A player cannot be moved from the 60-day disabled list to the 15-day disabled list.

A disabled player may be assigned to a Minor League Club for injury rehabilitation for up to 20-days for position players. Pitchers can be granted as many as 30-days of Minor League Rehab.

3. Player Options

After a player has played three full professional seasons, he must be protected on the Major League Team's 40-man roster or he becomes available to be selected in the Rule 5 draft. If after the three years he is placed on the Major League Roster, the club then has options on that player.

A player on the 40-man roster but not on the 25-man Major League Roster is on what is called optional assignment. A player on optional assignment has three option years, and can be sent up and down as many times as the club sees fit during those three seasons.

A player who has been in the Major Leagues for parts of three different seasons is out of options, and must clear waivers in order to be sent down beginning with his fourth big league season.

4. Waivers

A waiver on a Major League Player is defined as "...a permission granted for certain assignments of player contracts or for the unconditional release of a Major League player..."

A Major League Player placed on waivers will have "cleared waivers" if after three business days following waivers have been requested he has not been claimed by another team. If a player "clears waivers", the team has secured waivers on that player for the rest of the waiver period.

A team can do one of three things with a player once he has cleared waivers. They can send him to the minors, for veteran players with the consent of the player, they can release him, making him available to other teams, or they can trade him to another team, regardless of whether or not the trading deadline has passed. In order for a team to trade a player past the July 31st trading deadline, he must have first cleared waivers.

If a player placed on waivers is claimed by another team, the club requesting waivers may withdraw the waiver request. If the club doesn't withdraw the waiver request, the player's contract is assigned based on certain criteria. If only one club claims the player, that club is awarded the player. If more than one club in the same league makes claims, the club currently lower in the standings gets the player. If the claim is made during the first 30 days of the season, the previous season's standings are used to determine who gets the player. If clubs in both leagues claim the player, the player will always go to the club in the same league as the club requesting waivers.

5. Designated for Assignment

When a club designates a player for assignment, it allows the club to open up a roster spot while it figures out what it is going to do with a player. Most often a player is designated for assignment so the club can open up his roster spot while they wait for him to clear waivers. A club may also designate a player for assignment while they try to trade him to another club.

6. Recalling Players From the Minors

When a player is recalled from the minor leagues he is either called up or his contract is purchase. A player who is called up already holds a spot on the 40-man roster. A player whose contract is purchased is not on the 40-man roster and must be added to it. If a club already has a full 40-man roster, it must drop a player from the roster.

7. Players To Be Named

A team may make a trade involving a player to be named at a later date.

There are two restrictions on deals involving players to be named. Any transaction made in this manor must be completed within 6 months of the initial transaction. Also the player to be named can't have played in the same league as the team he is being traded to.

A player on the disabled list can be traded as a player to be named. This happens because players on the disabled list can't be traded while they are disabled.

8. The Rule 5 Draft (also see below)

A player is eligible for the offseason Rule 5 draft if he is not on the 40-man Major League Roster, if he was 18 or younger when he first signed a pro contract and this is the fourth Rule 5 draft since he signed or if he was 19 or older when he first signed a pro contract and this is the third Rule 5 draft since he signed.

A player drafted in the Rule 5 draft must remain in the majors, be it on the 25-man roster or the disabled list, for all of the following season, or the club that drafted him must return him to his original club. Since a player to is returned must first be placed on waivers, a third club can claim the player. The claiming club would then be responsible to the same rules placed upon the team that drafted him in the Rule 5 draft.

9. Veteran Players

Any player who has been in the major leagues for five full seasons may not be assigned to the minor leagues without his consent.

A player with five years of major league service who is traded in the middle of a multi-year contract may demand a trade prior to the start of the season following the one in which he was traded.

Any player with at least ten years of major league service, the last five with the same major league club, may not be traded without his consent.

10. Inter-League and Intra-League Trades

A team may make trades without waivers from 5pm Eastern time, the day after the scheduled end of the season through July 31st. Waivers are necessary to make trades from August 1st through 5pm Eastern Time, the day after the scheduled end of the regular season.

Evan Grant, The Dallas Morning News, Inside the Rangers, March 22, 2005 :

Minor league options ?

Though there are exceptions to every rule in baseball's amazingly arcane and well-guarded rule book, here are the basics.

When a player is drafted, unless he signs a major league contract (a la Mark Teixeira), he does not need to be protected on the 40-man roster for a minimum of three years. (Players 18 or younger at draft time have four seasons before they need to be protected; 19 or older have three).

Once a player must be put on the 40-man roster, the option clock starts ticking. Players on the 40-man are, for our purposes, on the major league roster. To take them from the 25-man roster and place them on a minor league roster represents an option.

Every player has three options once they are on the 40-man roster. Only one option is used up per year, regardless of how many times said player shuttles between the minors and majors in a given season. Also, if a player is sent down for less than 21 days, he doesn't use an option.

Finally, when a player has exhausted all three of his options, he can't be sent back to the minors without giving other teams the right to claim him on waivers (so long as that other team puts him on its 25-man roster).

If the player goes unclaimed, the team may then "outright" the player to a minor league roster. He is off the 40-man roster at that point and to be called back to the majors, his contract would have to be purchased and a spot would have to be cleared for him on the 40-man roster. And each time the team chooses to send that player back, he'd have to clear waivers again. On his second "outright" assignment, a player can choose free agency.

At last, a quick explanation of the Rule 5 draft

By Alan Schwarz

Note: This story ran in Baseball America in 1995, and has been dusted off and updated where applicable.

You've seen it written and referred to a zillion ways: the Rule 5 draft, the minor league draft, the rule V drafts, that draft at the Winter Meetings that's a little too complicated so I'll wait to see if it matters later . . .

It's actually not that involved, so as a public service we now present to you an observer's guide to what Baseball America typically refers to as the major league Rule 5 draft.

The process doesn't shake baseball's rafters, but it does add a wrinkle to the player-development game that's worth understanding. Every once in a while, a player makes a significant impact after being chosen, Pittsburgh's Roberto Clemente in 1954 being the classic example.

The Rule 5 draft has been a staple of the Winter Meetings almost from its beginning and sprung up as a method to prevent teams from stockpiling talent in their minor league systems. Players not on major league rosters would otherwise have little or no chance to find an opportunity to play elsewhere, though that restriction was further eased in the 1980s when minor leaguers got the right to become free agents after six full seasons.

Major league teams must protect players on their 40-man rosters within three or four years of their original signing. Those left unprotected are available to other teams as Rule 5 picks.

Players who were 18 or younger on June 5 preceding the signing of their first contract must be protected after four minor league seasons. Players 19 and older must be protected after three seasons.

But here's the kicker: To prevent teams from drafting players willy-nilly, each Rule 5 pick must be kept in the major leagues the entire following season or be offered back to his former team for half of the $50,000 selection price. Few players are ready for such a jump, so only about 10-15 get picked each year. Fewer still last the whole season in the big leagues.

"They have to keep a guy for the whole year, so a lot of teams are safe," says Paul Snyder, the Braves' director of scouting and player development. "But there have been kids drafted out of A-ball.

"A few years ago (in 1984) Toronto got two guys (Lou Thornton and Manny Lee) who could pinch-run and play defense. They're easier to carry in the American League because there aren't as many pitching changes."

Other miscellaneous Rule 5 rules and tidbits: