Owners pull $1 billion guarantee

October 23, 1994|By New York Times News Service

NEW YORK -- The salary-cap proposal that triggered the strike that canceled the World Series is about to become even less appealing to the players. According to a memo sent to the clubs last week, the owners plan to withdraw the $1 billion guarantee they offered players in their original proposal.

The guarantee was a significant element of the plan in which the owners would give the players 50 percent of their revenue for salaries and other player costs. The $1 billion figure was based on the projected players' share of the owners' estimated $1.78 billion revenue this year.

The strike, however, shattered that revenue total and could leave the owners with as little as $1.2 billion in 1994 revenue.

"In light of the economic damage done," the memo said, "the clubs will withdraw the $1 billion guarantee. The players would still be entitled to 50 percent of the revenues, but they would have to assume the risk that 50 percent would be less than the $1 billion they would have earned in 1994."

The clubs have not given the players a revised proposal but plan to do so after the mediator, William J. Usery Jr., schedules joint bargaining sessions, perhaps this week. The owners have been expected to produce a revised salary-cap proposal because they couldn't afford to implement the cap with a $1 billion guarantee, considering economic developments, if they declare an impasse in negotiations.

"We haven't heard any of that before," Donald Fehr, the head of the union, said yesterday when told of the memo's contents. "That will come with great fanfare. Clearly it will be worse. It's got to be worse."

Chuck O'Connor, general counsel of the clubs' labor relations committee, declined to comment.

The memo, which was written by the owners' labor relations lawyers and sent to the clubs last Tuesday, included other elements of the proposal the union has not been told about. High-ranking officials of two clubs disclosed parts of the memo on the condition they would not be identified.

For the first time, the memo attaches figures to the part of the clubs' proposal that deals with escalating minimum salaries for players in their first four years in the major leagues, when they would be subject to the clubs' "unilateral control:"

Players in their first year would earn $115,000; second-year players, $175,000; third-year players, $275,000; fourth-year players who are not Type A or B players under the ranking statistics, $500,000; fourth-year players who are Type A or B, $750,000.

The minimum salary has been $109,000. The union has proposed raising the minimum to at least $175,000, with no set salaries beyond that level.

In another change, the memo says that the clubs will withdraw from the revenue to be shared with the players both the clubs' and the players' licensing money.

The union has objected to players' licensing money being included, so the clubs will cut out theirs as well.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.