MLB Transactions Glossary
The transactions glossary is for the convenience of the readers of ChicagoCubsOnline. The information on this page is from Cot’s Baseball Contracts and is not original content. Jeff Euston of Cot’s Baseball Contracts is the author of this content and an expanded transactions glossary, as well as contract details for all 30 Major League teams, can be found at Cot’s Baseball Contracts.
A club may place an injured player on the 7-, 10- or 60-day disabled list by submitting to the commissioner’s office an application, accompanied by a diagnosis from the club physician. A player on either list continues to accumulate Major League service time, but he must remain inactive for a minimum of 7, 10 or 60 days, with Day 1 beginning after the player’s last game appearance. A club may make the placement of a player on either list retroactive to the last date in which he played, up to a maximum backdating of 10 days. A club may send a player on the DL to the minor leagues for a rehab assignment lasting a maximum of 20 days for position players and 30 days for pitchers.
7-Day Disabled List (Concussion)
Beginning with the 2011 season, teams could place a player who suffers from a concussion on a 7-day disabled list. The team must have a designated club specialist submit a detailed report that includes medical information and video of how the injury occurred to MLB’s medical director. The 7-day DL can only be used for players with a concussion not for any other type of injury.
A player on the 7-day DL does not count against the team’s active 25-man roster, same as the 15-day DL. A player on the 7-day DL does count against the team’s 40-man roster. The player can be activated on the eighth day after he is cleared (receives approval) from the team’s specified specialist and Major League Baseball’s medical director. If the player is not reinstated from the 7-day DL by day 14, the player is automatically transferred to the 15-day DL.
10-Day Disabled List
A player on the 10-day disabled list does not count against the 25-man active roster but continues to count against the 40-man roster. There is no limit to the number of players a club may put on the 10-day disabled list. A player may be activated beginning on Day 16, though the club is not required to reinstate him at any specific time.
A player may be transferred from the 10-day disabled list to the 6o-day disabled list, but the opposite is not permitted. If a player is transferred, his time on the 10-day disabled list is credited toward the minimum stay on the 60-day disabled list.
60-Day (Emergency) Disabled List
A player on the 60-day disabled list does not count against either the 25-man or 40-man roster. A player may be activated beginning on Day 61, though the club is not required to reinstate at any specific time. A player placed on the 60-day disabled list after August 1 remains there for the rest of the season.
There is no limit to the number of players a club may put on the 60-day disabled list, but a player may not be placed on (or transferred to) the 60-day disabled list unless the club’s 40-man roster is full. Once the season ends, a player on the 60-day disabled list must be reinstated to the 40-man roster or designated for assignment.
If a player violates the terms of his contract, his club may petition MLB to have him place on the disqualified list, allowing the club to replace him on both the 25-man and 40-man rosters. A player on the disqualified list is not paid and does not earn service time.
Family Medical Emergency List
A club may place a player experiencing a family emergency or the death of a loved one on the family emergency list with permission from the commissioner’s office. The player may spend between three and seven days on the list, during that period, his club may replace him on the active 25-man roster. A player on the family medical emergency list continues to accumulate Major League service time. If an absence extends more than seven days, the club must resort to placing the player on the restricted list, where he is not paid and does not earn service time.
If a player, through some action of his own, is unable to render his services to his club, the team may petition Major League Baseball to have the player placed on the restricted list. Generally, the list is used for a long-term absence, such as drug suspension, a visa problem or leaving the club without permission. A player on the restricted list does not count against the 40-man roster, and there is no minimum or maximum length of time he must stay on the list. A player on the restricted list is not paid and does not earn service time.
An option (optional assignment) allows a club to move a player on its 40-man roster to and from the minor leagues without exposing him to the other 29 teams.
After four or five years as a professional, a player must be added to his club’s 40-man roster or the player will be exposed to the 29 other clubs in the Rule 5 Draft. A club has five years to evaluate a player who signs his first pro contract at 18 years or younger, but only four years to decide on a player who signs at age 19. For purposes of calculating years as a pro, the counting begins the day a player signs his first professional contract, not the season he begins play.
When a player is added to the 40-man roster, his club has three “options,” or three separate seasons during which the club may move him to and from the minor leagues without exposing him to other clubs. A player on the 40-man roster playing in the minors is on an optional assignment, and within an option season, there is no limit on the numbers of times a club may demote or recall a player. However, a player optioned to the minor leagues may not be recalled for at least 10 days, unless the club places a Major League player on the disabled list during the 10-day window.
After three options are exhausted, the player is out of options. Beginning with the next season, he must clear waivers before he may be sent to the minors again. See Waivers. Additionally, a player with five years of Major League service time may not be sent to the minor leagues on an optional assignment without his consent.
Counting Option Years
- If a player is not sent to the minor leagues during a season (year), an option is not used.
- If a player is on the 40-man roster in Spring Training but options to the minors before the season begins, an option is used.
- If a player’s optional assignment (s) to the minors totals less than 20 days in one season, an option is not used.
- A player may be eligible for a fourth option year if he has been optioned in three seasons but does not yet have five full seasons of professional experience. A full season is defined as being on an active roster for at least 90 days in a season. If a player is placed on the disabled list after earning 60 or more days of service in a single season, his time on the DL is counted. The 90-day requirement means Short-Season leagues (New-York Penn, Northwest, Pioneer, Appalachian, Gulf Coast, Arizona Rookie, Dominican and Venezuelan Summer Leagues) do not count as full seasons for the purposes of determining eligibility for a fourth option.
A player earns Major League service time for each day he spends on the active (25-man) roster or on the Major League 15-day or 60-day disabled lists. A player also continues to earn service time while serving any disciplinary suspension or serving in the military.
Under the CBA, one year of service time is defined as 172 days. A player may earn up to 172 days of Major league service time during a championship season (regular season), which generally last 183 calendar days. If a player is sent to the minor leagues on an optional assignment for a total of less than 20 days during a season, he received service time for an entire season.
Service Time Specifics
- A player must be promoted from the minor leagues is credited with Major League service beginnings with the date he physically reports.
- Service time is no interrupted when a Major League player is traded and reports to his new club in the normal course (72 hours).
- A player demoted to the minor leagues is credited with Major League service time through the date of the assignment.
- A player who is unconditionally released is credited with Major League service time through the date he was notified of his release.
- A Major League player designated for release or assignment continues to be credited with service after the designation, through the date of the actual assignment or the date he is notified of his unconditional release.
- For a player who appears on the Opening Day roster, Major League service times is credited as of the earliest scheduled opener, without regard to the actual opening date of his own club.
- Major League service time is not credited during any period or periods of optional assignment totaling 20 days or more during a single season.
Service Time Landmarks
- A player with at least three years of Major League service is eligible for arbitration.
- In addition, a three-year player may not be removed from the 40-man roster without his permission. The player may choose to be released immediately or at the end of the season.
- A player with at least five years of Major League service may not be demoted to the minor leagues on an optional assignment without his consent. A five-year player who refuses an optional assignment to the minors must be offered his release.
- A player with at least six years of service is eligible for free agency.
- A player with at least 10 years of service time may not be traded or assigned without his consent, provided the player has spent the last five years with his current team (10-5 Rights).
A player with almost three years of Major League service time may become eligible for arbitration. To qualify as a Super Two, a player must have at least two years of service time, but less than three and have accumulated at least 86 days of service time in the previous year and rank in the top 22 percent (22%) of all two-year players in service time.
A club may unilaterally renew the contract of a player not yet eligible for arbitration is the club and the player fail to agree on a salary. A club may not renew a contract at a salary less than 80 percent (80%) of the player’s salary and performance bonuses the previous year or less than 70 percent (70%) of his salary and performance bonuses from two years earlier.
A player is a rookie unless, during a previous seasons or seasons, he has more than 130 at-bats of 50 innings pitched in the Major Leagues, or more than 45 days on a Major League active roster during the 25-man limit period (April – August), excluding time on the disabled list. Service time accrued during September does not count against the player’s rookie status the next season.
Major League Roster Limits
The Major League roster limit is 40 from September 1 until MLB Opening Day when the number of players on the active roster must be reduced to 25 players. For scheduled doubleheaders and make-up games, roster sizes may be increased to 26 players as long as the doubleheader is not being played the day immediately after a cancellation.
A players and club who cannot agree to a contract may agree to salary arbitration, provided the player has enough Major League service time. CBA, Article VI F.
The following players are eligible for arbitration: Players with at least three but less than six years of Major League service time. The top 22 percent of players with at least two but less than three years of Major League service, provided the player earned at least 86 days of service in the previous season (Super Two). If two or more players are tied in qualifying for the top 22 percent, all such players qualify. A year of service is 172 days.
A club must offer contracts (tender a contract) to players under its control by Dec. 12
The club’s salary offer to a player under its control (pre-free agency players) may not be less than 80 percent (80%) of the player’s salary and performance bonus from the previous year of less than 70 percent (70%) of his salary and performance bonuses from two years earlier. (Exception: If a player won an arbitration award the previous year increasing his salary 50 percent (50%) or more, the 80 percent (80%) requirement does not apply.)
In mid-January, eligible players may file for salary arbitration, and three days later, the player and the club must each submit a salary figure for arbitration. The parties may continue to negotiate until the case goes before a three-person panel of professional arbitrators between February 1 and February 20.
At the hearing, each party has one hour to argue its case and 30 minutes for rebuttal. The player is required to attend and is generally represented by an agent. A club executive or attorney usually represents the club.
Criteria the panel may considers include the player’s contribution to the club in terms of performance and leadership, the club’s record and attendance, “special accomplishments,” the salaries of comparable players in his service-time class and, for players with less than five years of service time, the class one year ahead of him. The parties may not refer to team finances, previous offers made during negotiations, the Competitive Balance Tax, comments from the press or salaries in other sports or occupations.
The panel, without opinion, awards the player a one-year, non-guaranteed contract at either one salary or the other. If the player is cut before the 16th day before the season begins, he is entitled only to 30 days’ termination pay. If the player is cut during Spring Training, but after the 16th day before the season begins, he is entitled only to 45 days’ termination pay.
Maximum Salary Reduction
In tendering a contract to a player, or renewing the contract of a player no yet arbitration eligible, a club’s salary offer may not be less than 80 percent (80%) of the player’s salary and performance bonuses the previous year or less than 70 percent (70%) of his salary and performance bonuses from two years earlier. The 80 percent requirement does not apply if a player won an arbitration award the previous year increasing his salary 50 percent (50%) or more. For split contracts (paying a player one rate when he is in the Major Leagues and a lesser rate when he is in the minors), the maximum cut rule is 60 percent (60%) of the player’s salary from the previous season.
Designated for Assignment (DFA)
A player designated for assignment is removed from his club’s 40-man roster and, within 10 days can be traded, released or if he clears waivers, assigned to the minor leagues. A team may not designate a player for assignment if the corresponding transaction is to recall a player on an optional assignment.
A player designated for assignment may be traded. A club interested in acquiring a player who has been designated for assignment may try to work out a trade before the player is placed on waivers, eliminating the possibility he might be claimed by a club with a higher waiver claim priority.
A player designated for assignment that clears waivers and is not traded may be released. The player then becomes a free agent.
A club wishing to send a player designated for assignment to the minor leagues must first place him on irrevocable outright waivers, making him available to the other 29 clubs in reverse order of won-lost record.
If the player is claimed, he is lost to the claiming team for $20,000 (Irrevocable waivers may not be reversed). The claiming team is responsible for the balance of the contract.
If the player is not claimed (clears waivers), the club may option him or assign him outright to the minor leagues, though he must continue to be paid according to the terms of his contract. A player may be assigned outright to the minors only once in his career without permission. Thereafter, he may either 1) reject the assignment and become a free agent, or 2) accept the assignment and become a free agent at the end of the season if he’s not back on the 40-man roster. Additionally, a player with three years of Major League service may refuse an outright assignment and choose to become a free agent, regardless of whether he has been sent outright to the minors previously. A player with five years of Major League service time who refuses an outright assignment is entitled to the money due according to the terms of his contract.
A player assigned outright to the minor leagues for the first time in his career must accept the assignment. Thereafter, a player has the choice of 1) rejecting the assignment and becoming a free agent immediately after, or 2) accept the assignment and become a free agent at the end of the season if he has not been returned to the 40-man roster.
A player with three years of Major League service time may refuse the outright assignment and choose to become a free agent immediately or at the end of the season.
A player with five years of Major League service time who refuses an outright assignment is entitled to the money due according to the terms of his contract.
A waiver is permission from other clubs to trade or assign a Major League player’s contract. A waiver request is filed through the Commissioner’s Office and granted for a limited time period.
There are four types of waivers: 1) Unconditional Release Waivers, 2) Outright Waivers, 3) Optional Waivers) and 4) Trade Assignment Waivers
Unconditional Release Waivers
A club that wishes to remove a player from its 40-man roster but keep him in its minor league system must first place him on outright or special waivers. Outright waivers are not revocable, so a player claimed on outright waivers may not be pulled back by his original club. A club may not request outright waivers on a player with a complete no-trade clause or on a player with ten-and-five rights (also called five-and-ten rights).
Through 2006, outright waivers secured between September 1 and the 30th day of the next season were known as Special Waivers. The owners and players association eliminated Special Waivers in the 2007-2011 Collective Bargaining Agreement.
Optional Major League waivers are required when optioning a player who has options remaining but who is more than three calendar years removed from his first appearance on a Major League roster (40-man roster). Because optional waivers are revocable, players usually clear in this scenario.
Trade Assignment Waivers
Trade assignment waivers are utilized in August as means to gauge trade interest. Between August 1 and the end of the season, a player may not be traded without first clearing trade assignment Major League waivers. If the player is not claimed within 47 business-day hours, he may be traded to any team. If the player is claimed by another club, the request may be revoked, allowing his current club to pull him back. However, the player’s current team also may 1) work out a trade with the claiming club within 48 ½ business-day hours, or 2) elect to allow the claiming club to take the player for a $20,000 fee and assume responsibility of his current contract. If more than one club claims a player, the club with the lower winning percentage has priority, but American League clubs have priority for AL players and National League clubs have priority for NL players. Once a player on Major League waivers has been claimed and the waiver request revoked, any subsequent request for Major League waivers during the same period is irrevocable. A player with a no-trade clause who is claimed on Major League waivers must be pulled back if the player’s no-trade clause allows him to block a deal to the claiming club. However, the player my waive the no-trade clause and join the claiming club.
Waiver Periods and Waiver Claim Priority
- November 11 – April 30 (Nov. 11 – 30th day of the next season)
- The club with the worst won-loss record in the previous season has priority
- May 1 – July 31 (31st day of the season – July 31)
- The club with the worst won-loss record in the current season has priority
- August 1 – November 10
- The team with the worst won-loss record in the current season has priority, but American League clubs have priority for AL players and National League teams have priority for NL players.
Free Agent Compensation
A club is entitled to compensation when a free agent signs elsewhere if 1) he had played with the former club since Opening Day of the previous season, 2) the club made the player a Qualifying Offer in the amount of the average salary of the 125 highest-paid players in the game, and 3) the player declined the Qualifying Offer and signs a Major League contract with another club before the next Rule 4 First Year Player Draft.
The free agent’s former club receives a supplemental draft pick between the first and second rounds. If more than one club is entitled to a supplemental pick, selections are awarded in reverse order of win-loss percentage in the recently completed season.
The free agent’s new club forfeits its highest-available selection in the next Rule 4 First Year Player Draft (The pick is eliminated rather than being awarded to the former club, as is was in the previous CBA). A club signing more than one free agent subject to compensation forfeits its highest remaining selection for each signing. The first 10 picks in the Rule 4 First Year Player Draft are protected and cannot be forfeited. If a club holding one of the first 10 draft picks signs a free agent subject to compensation, that club forfeits its next highest selection in the draft. With the exception of draft picks awarded for failure to sign a player in the previous Rule 4 First Year Player Draft, all of a club’s draft picks – including draft picks acquired by trade, compensatory draft picks awarded for losing a free agent, and Competitive Balance or Forfeited Draft Pick selections, are subject to forfeiture for signing a qualified free agent.