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Betances loses arbitration case & you shouldn’t be shocked

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Betances to earn team’s offer of $3m opposed to filing of $5m. Yankees president Levine has earnest criticism of Betances’ agent company.

MLB: Texas Rangers at New York Yankees Brad Penner-USA TODAY Sports
Up in arms is the baseball world that follows the Yankees, elite late inning relievers, and baseball in general regarding Dellin Betances and his loss at a salary arbitration hearing. Yankee’s fans are outraged, Brian Kenny is outraged, and many others. Most of whom might not fully understand how players entering arbitration eligibility are valued or evaluated (no offense meant).

In terms of money making potential, the most important year is a player’s first year of arbitration eligibility. The figure covers the player’s entire body of work and henceforth called the platform salary sets a baseline for their following years of arbitration eligibility. Betances, has a great body of work for a relief pitcher.

Relief pitchers 2014 to 2016 (min 100 IP):

  • fWAR - 1st
  • WPA+ - 1st
  • WPA/LI - 3rd
  • K/9 - 3rd
  • ERA - 5th
  • FIP - 5th
  • xFIP - 3rd
  • SD - 5th

On top of his statistical accolades, he has been an All-Star in back-to-back-to-back seasons from 2014-2016, was 3rd in Rookie of the Year voting in 2014, and even placed 14th in AL Cy Young voting in 2015 with a 5th place vote received from Mark Feinsand of the New York Daily News. Awards and accolades most definitely figure into the arbitration evaluation process and I’m sure they were not ignored in Dellin’s case. However, historically, relief pitchers who are not handed the ball in the 9th inning are undervalued in the arbitration process.

There is no argument that Betances is an elite reliever. I personally do not believe he should have been awarded a $5m salary but do believe a salary higher than $3m is warranted. I feel his agent company could have gone in at a lower request, possibly in the low $4m. The story might be different if that were the case, however a panel will not award a middle ground salary, and will only award what the team had offered or the player requested. Since the $5m figure was just way off, Betances and his agency really had a slim chance.

Unfortunately, since Betances wasn’t a closer he got the short end of the stick. The process is crude and if held up to today’s standards where analytics and advanced saber-metrics are now commonplace, then the system simply archaic. Relief pitchers are judged by only a few measly statistics that don’t really paint the entire picture of a pitcher’s performance.

Arbitration teams also heavily rely on comparisons and trough regression analysis an narrow down a “comp” to present to a panel. Tulane University has a Sports Law group that holds arbitration hearing competitions and here is one of their sample exhibits:

No where in the document are there any advanced saber-metrics. Games pitched, ERA, Saves, Holds, WHIP, BB/9, K/9, BAA & WAR. That’s pretty slim when comparing players, and in a regression analysis Betances won’t be compared to closers like Chapman. Unfortunately, there really aren’t a whole lot of relief pitchers to truly compare to Betances in this regard so because there isn’t a viable “comp” then that makes projecting his salary even more difficult for a team.

Hopefully this case has sparked enough concern that the current system is out of place and out of date. Legal arbitration teams should be brought up to date with player evaluation in order to find a justified salary for a player. Unfortunately teams won’t agree as this undervaluation benefits teams. I don’t think this is going to be the last case similar to Betances’ and I’d look toward this being a hot item for discussion come winter of 2020 when the current CBA expires.

In my own attempt to model the current arbitration process I’ve used Rich Reider’s research to develop my own model in projecting arbitration salaries for use in projecting Texas Rangers salaries for 2018 and beyond. In comparison to MLBTR it came out more accurate than I first had anticipated. Take a look for yourself. I plan to polish this now that all cases are complete and project arbitration eligible players for the Texas Rangers after the 2017 season is over.

Doc link here: