How does salary arbitration work?
The process is what is known as “Final Offer Arbitration” (though in the world of alternative dispute resolution it is now becoming known simply as “Baseball Arbitration”). In mid-January, each side to the dispute submits a salary figure to a panel of independent arbitrators. After a few hours of hearings, held in early February, the arbitrators pick one figure or the other. The arbitrator cannot “split the baby” and settle on a salary in the middle of the spread between the club’s figure and the player’s. One side leaves the arbitration a winner and the other a loser, heightening risk and encouraging negotiation and settlement.
