TERMS AND RULES: SUPER-TWO’s

Major league players reach free agency after six seasons, giving them freedom to test their value on the open market. During that six-year period, the arbitration process kicks in, giving players a chance to “put in for a raise” for the next season. For the majority of players, they are arbitration-eligible after three years.

A select group of players that have between two and three years’ service are designated as Super-Two’s, and they are arbitration-eligible a year earlier. Super-Two’s have four arbitration years instead of three which accelerates their whole salary-earning process.

With the latest Collective Bargaining Agreement going into effect, Super-Two’s will be those who are in the top 22% of the class in service time (up from 17%). In other words, all players with between two and three years’ service time are compared to each other and the top 22% (by service time) get to start the arbitration process a year early. (There is also a requirement that they have accumulated at least  86 days of service time in the immediately previous season). All players tied at 22% are eligible.

Even if you aren’t familiar with Moneyball, it is a pretty obvious fact that MLB clubs enjoy a signifcant advantage in the salary arena for the first six years of a given player’s major league career. These are the years of “club control” and it is the best it ever gets for the club. The Arizona Diamondbacks got 37 wins from Ian Kennedy and Daniel Hudson in 2011 for a total of less than $850,000 in salary. They were still under club control and those were the contracts they signed.

The Giants got a couple of Cy Young seasons from Tim Lincecum before he got to aribtration and those two years combined cost the club just over $1M.

With arbitration eligibility comes a much greater earning power for the player. Lincecum went to arbitration with those two Cy Young Awards on his resume and it was obvious that he was going to get an enormous raise. The player and the club exchange figures and the arbiters compare the player’s stats to other comparable players’ numbers and what they are being paid. After this analysis, the abiter chooses either the player’s figure or the club’s offer, nothing in between, for the next season’s salary. This all happens again the following year, until the player reaches the six-year point.

Lincecum and the Giants came to terms, without actually going to arbitration, on 2 years/$23M. Before agreeing, the two sides had exchanged figures and the pitcher asked for $13M while the Giants offered $8M. So even if Lincecum would have “lost” his arbitration case, his salary would have gone from $650,000 to $8M.

This, of course, is an extreme case. But, as you can see, once the arbitration/free agency train starts rolling, the player sees a substantial raise in pay, one way or the other. The sooner a player gets on that train, the more money he makes over the course of his career.

Being designated a Super-Two is the fastest path available.

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