MLB Owners Propose 2028 Salary Cap in Post-Season Labor Talks
The league suggests a $258.2 million hard cap and $180.2 million floor, a move that would force eight major-market clubs to cut $528 million from their payrolls.
By Megan Ivanov ·
Major League Baseball owners formally proposed a hard salary cap on Tuesday, a move that would not take effect until the 2028 season. The proposal sets a maximum team payroll at $258.2 million and a minimum at $180.2 million. This figure relies on average annual values from the luxury tax payrolls.
The owners cited existing financial commitments as the reason for the delayed start. Glen Caplin, a league spokesman, stated that clubs need a full offseason to adjust their spending habits. The plan allows teams to operate at 90 percent of the floor in the inaugural cap year. That amount is $162.18 million, but clubs must spend the full floor amount over the following three years.
The timing of the proposal is critical. Free agent negotiations for the 2026-27 offseason began on Monday. The current five-year labor contract expires on December 1. Management is expected to lock out the players' union if a new deal is not reached. The last time the league discussed a cap was during the 1994 strike, which canceled the World Series for the first time in 90 years.
The players' association has historically rejected the concept of a hard cap. In a statement, the union criticized the owners for trying to replace the current system with one designed to increase franchise values. The union called the proposal a zero-sum system that harms middle-class players. They argued the plan would strip competitive advantages from smaller market teams.
Management's numbers show a clear divide in the league. Eight teams would need to reduce their current payrolls by a combined $528 million to meet the 2028 cap. These teams include the Boston Red Sox, Chicago Cubs, Los Angeles Dodgers, New York Mets, New York Yankees, Philadelphia Phillies, San Diego Padres, and Toronto Blue Jays. Conversely, twelve teams would need to increase their spending by $636 million to reach the floor.
The twelve teams facing increased spending requirements are the Oakland Athletics, Chicago White Sox, Cincinnati Reds, Cleveland Guardians, Colorado Rockies, Miami Marlins, Milwaukee Brewers, Minnesota Twins, Pittsburgh Pirates, St. Louis Cardinals, Tampa Bay Rays, and Washington Nationals. The Milwaukee Brewers and Tampa Bay Rays are notable because they are the reigning World Series and American League champions, respectively.
The proposal is tied to a 50-50 revenue split. The union disputes management's definitions of revenue and expenses. If a work stoppage causes MLB revenue to decline, the cap and floor figures would be lower. In May, management had proposed a fixed cap of $245.3 million and a floor of $171.2 million. The new figures are higher, reflecting changes in the revenue calculation.
Caplin noted that the proposal includes earlier free agency and a $1 million minimum salary. The plan also includes a 30 percent increase to the pre-arbitration bonus pool. Owners would accept the union's proposal to reduce service time for free-agent eligibility from six seasons to five for players aged 30 and older. In exchange, teams would retain the right to make a qualifying offer. If a player rejects that offer, he becomes eligible for salary arbitration.
The agreement would raise the minimum salary from $780,000 to $1 million for players with two years of service. Minor league minimums would also increase. The initial big league deal minimum would rise from $63,600 to $73,400. Additional contracts would see their minimums increase from $127,100 to $146,700. A one-time bonus payment based on 2026 service time would provide $285,000 to players who appeared in at least 172 of the 187 regular season days.
The pre-arbitration bonus pool would grow from $50 million in 2026 to $65 million in 2027. It would reach $75 million over the term of a seven-year labor agreement through the 2033 season. MLB would centralize media revenue for 2028 while keeping the current luxury tax system in place for 2027. The owners are willing to discuss phase-in timelines and procedures to ease the transition into the new cap and floor system.
Source: The Aegis
