The fight that could shut down baseball ... again

Major League Baseball and the MLB Players Association have entered a battle over what the future economics of the sport will look like after the current collective bargaining agreement expires on Dec. 1.

>The main sticking point: a salary cap.

>MLB wants a hard salary cap like the other major North American professional sports leagues and appears determined to lock the players out in order to get it. Baseball is portraying its small-market teams as having too little hope because of the payroll disparity between the sport's haves and have-nots.

>The players' union, meanwhile, wants no part of a hard cap.

>Back in 1994, the players went on strike to avoid agreeing to a salary cap, causing the season to end early without the playing of a World Series. Thirty-two years later, the union's stance hasn't changed. Led by interim executive director Bruce Meyer, the players seem steadfast and united against what they view as an artificial ceiling on their guaranteed earnings.

>"Their proposal is worse than the proposal in 1994," Meyer told reporters last week. "Our union has never been broken. It never will be."

>The two sides are currently so far apart that they can't even agree on the problems they want to solve during this negotiation process.

>"Both sides keep fighting over the numbers before they've agreed on the structure that sets it," Chris Koras, the head of sports for Working Capital Partners, a company providing institutional capital for talent, and Klutch Sports' former head of baseball, told Yahoo Sports.

>This fundamentally huge gulf between what the two sides currently prioritize is why there's widespread fear in baseball that a work stoppage beyond Dec. 1 could eliminate some, if not all, of the 2027 MLB season. Are there ultimately salary cap and floor numbers that would avoid this looming catastrophe?

What is MLB's case for a salary cap?Baseball and its owners are going to great lengths to paint a picture of widespread disparity in the sport. The league's fact sheet sent to the media pointed out that the most recent small-market team to win the World Series was the 2015 Kansas City Royals, with 85% of World Series participants and 80% of League Championship Series teams coming from big-market franchises. The payroll gap among teams, with the Los Angeles Dodgers paying a luxury-tax payroll of roughly $340 millionmore than the lowest-spending Miami Marlins, has led to a competitive imbalance that the league believes it needs to immediately address. MLB believes the fans want a cap as well, citing a Morning Consult poll from November that found that 59% of U.S. adults and 79% of avid baseball fans support a salary cap system like what's already in place in the other major North American professional sports.

>A hard salary cap of $245.3 million to go with a salary floor of $171.2 million tied to more local media revenue-sharing is the league's initial proposed solution. To get the players to agree to the cap, the league is offering a 50% share in league revenue, higher than the players' current share. The cap would require 12 teams to increase payroll by a combined $617 million to reach the floor, while eight clubs would have to reduce payroll by $578 million to get under the cap, per MLB figures.

>In a capped landscape, larger-market teams would lose their spending advantage over their foes and would have to share more of their local revenues, but Mike Whitmire, the co-founder and CEO of FloQast, an accounting software provider for Fanatics, Zoom, Instacart, MLB, NBA and NFL clubs, believes lower costs for large-market teams would increase franchise valuations. The average MLB team valuation is currently $2.9 billion, far less than teams in capped leagues with more centralized revenue sharing, like the NBA's $5.4 billion and the NFL's $7.1 billion.

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What could a salary cap and floor structure look like?A salary floor would work only if there were increased revenue-sharing so that smaller-market teams could afford the drastic spike in payroll costs. Otherwise, according to Whitmire, five-to-10 MLB teams would become immediately insolvent and not be able to afford player costs.

>What Whitmire proposes is taking the 50% of league revenue that MLB has proposed going to players— reportedly more than the 47% that went to players in 2024 — and making that the salary floor. Based on the reported $13.1 billion in revenue that MLB generated in 2025, $6.55 billion would've been allocated to teams to pay the players, with a salary floor split among the 30 teams for 2026 coming in at $218.33 million. Whitmire then takes 20% of the floor total, $43.66 million, to set a hard cap of $262 million.

>"This is something I believe both sides should be willing to work towards," Whitmire told Yahoo Sports. "The players get more than the other leagues, and owners get cost certainty."

Bruce Meyer took over as MLB Players Association president in February.Pacific Press via Getty ImagesWhat do the players want?While MLB wants a salary cap, the players' union wants a higher share of revenue, virtually doubling the minimum salary, increasing the competitive balance tax (luxury tax) threshold from $244 to $300 million and what they're calling a "competitive integrity tax."

>The players' union has long contended that small-market owners are pocketing revenue-sharing money instead of putting it toward the on-field product. As a result, it has proposed a competitive integrity tax in which teams whose payrolls are below $150 million are ineligible to receive league revenue-sharing. To pay for that, the union has proposed that close to 90% of local media be shared by all 30 teams so that each one can remain solvent, per Meyer. The union also wants players who are at least 30 years old to reach free agency with five years of service time, instead of the six in the current CBA.

What are the experts saying about the two sides of the debate?While Whitmire seems hopeful about MLB's salary-capped future, Koras is far less bullish. He doesn't believe it will ultimately survive these negotiations, arguing that there's no current existential crisis in baseball necessitating such a drastic structural change.

>"Players have fought against this forever in the MLB, and a cap is really just the ceiling of what they can earn," he said. "There's really no version of a cap that leaves players better off than what an open market does for them."

>Koras believes that owners care far more about improving their valuations than a salary cap. He argues that a better solution would be increasing revenue-sharing to help small-market clubs afford the union's competitive integrity floor, which would compel them to spend money on winning instead of pocketing it.

>"It would really improve the overall health of the game," he said, "because it raises the floor of competitiveness across the league. It gives those fans something worth watching."

Does a salary floor represent some common ground?The MLB's salary floor and the MLBPA's competitive integrity tax are conceptually similar enough that it might be the first step toward an agreeable place between both sides.

>"The principle of it is something the owners should be good with," Whitmire said.

>To make sure teams can afford the $150 million payroll minimum, the MLBPA proposal guarantees that each team would receive a certain amount of general revenue per year, starting with $240 million in year one. While there's still a ton to fight over, teams have gone decades with bargain-basement payrolls for the sake of off-field profitability rather than on-field success. The two sides seem to agree that this mindset should be left in the past.

A central question: How will revenue be determined?What counts as revenue that teams will ultimately share with one another and total revenue that will be divided between the league and its players will be the subjects of fierce debate moving forward; this underscores Koras' point about fighting over numbers before agreeing to their structure. Meyer claims that expansion fees won't count toward total revenue, while expenses such as amateur signing bonuses and interpreters for foreign-language players all count against the players' share.

>"It's taking billions of dollars off the top before they're proposing to even share any of that," he said.

>How the next CBA looks could vary wildly depending on how the two sides determine the revenue the teams share among themselves and with the players. MLB eventually wants to nationalize its media rights contract and has structured its contracts with Fox, ESPN, TBS, Peacock and Netflix to all expire following the 2028 season. Aside from the salary cap, the issue of how to define revenue and then share it will likely cause the most friction.

What does MLB think about the PA proposal?A large portion of the MLBPA proposal seems to go completely against the direction MLB wants to take the sport.

>MLB contends that the players' proposal not only doesn't improve parity in baseball but also worsens the league's current competitive-balance crisis. It argues that the Dodgers would pay less in luxury taxes under their system, allowing the team to spend an additional $70 million on payroll. And granting free agency to players earlier in their careers, MLB believes, would drive small-market, homegrown stars to leave their teams earlier.

>"The MLBPA's proposal would reduce the amount transferred to lower-revenue clubs, weaken the competitive balance tax and lead to even more payroll disparity," Glen Caplin, an MLB spokesman, said in a statement last week. "Baseball has gotten stronger because we listened to the fans and made necessary changes on the field. The biggest issue we need to solve next to continue to grow the game off the field is fixing the payroll disparity unseen in any other major U.S. sport."

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What could the next MLB CBA look like?Whitmire and Koras couldn't disagree more on how these CBA negotiations will shake out. Are these opening proposals a step in the right direction or the harbinger of a long, nasty war that could derail MLB's sustained momentum in an era in which attendance, TV ratings, revenue and fan interest remain high?

>Koras believes that in exchange for dropping the hard cap demand, owners will extract either less movement on the luxury-tax threshold or a larger-scale revenue-sharing reform. But the road to get there will lead to a work stoppage.

>"Whether it costs a full season rests in few hands," Koras said. "Losing a season to this public and hostile negotiation would frankly be the most self-defeating move baseball could make now."

>Whitmire thinks MLB's opening offer of a salary floor means the two sides pre-negotiated extra revenue-sharing to give players a larger piece of the pie and that no games will be missed in 2027.

>"That's the most important thing they need to agree upon for a salary cap to be possible," he said. "While the posturing from each side has been negative, both sides will run negotiations all the way to the last minute, and fans will have to deal with stress and drama."

>Clearly, something has to give, and the gap between cap or no cap remains large, even if there might be agreement on a floor of some kind. How these fundamental issues shake out over the coming months will help determine the future of baseball. Given that baseball is a game of tradition, it's only fitting that the major sticking point between the two sides is an issue they've been feuding over for more than 30 years.