MLB salary cap proposal could fix the sport's biggest problem
MLB fans have been bracing for this moment for at least the last couple of seasons, but now that the league has responded to the Major League Baseball Players Association's opening proposal, the labor negotiations that will define the next decade of professional baseball have officially begun.
The MLBPA has earned its reputation over the years as the most powerful players' union in North American sports, as Major League Baseball remains the only American professional sports league that operates without a hard salary cap.
That distinction creates a fundamental difference in how baseball owners approach player acquisition.
In the NFL, for example, salary cap space itself is seen as a commodity; the more room you have under the cap, the more you get to spend on the players you need to make an impact. Every offseason, there's a mad scramble among multiple teams to get under the hard cap so that they can go after the free agents they want.
According to Spotrac, just about every team spent right up to the $279.2 million cap maximum, with some teams going over because of accounting details, dead cap space, and other minutiae.
Take the Tennessee Titans, for example. The team went 3-14, about what was expected, and still had $283.1 million in total cap allocations last season, ranking them 12th in the league, according to Spotrac.
The league average spend was $281 million, which is over the salary cap by $2 million (which again is possible with a hard cap due to accounting tricks and dead money from old contracts).
Baseball's offseason doesn't work like that.
A professional baseball team in the same position as the Tennessee Titans, winning less than 25% of its games, is doing its best to cut salary to the bone, trade away all assets that may cost them money in the future to the Los Angeles Dodgers and New York Yankees, and live off of the revenue sharing and luxury tax money.
The current system disincentivizes poor small-market teams from ever trying to compete, because no matter how many young players you draft or trade for, a super team like the Mets will always be able to outspend you by the time they're eligible for free agency, so as they get older (and better), their value is tied to the assets you can get back for them.
Ask the Detroit Tigers and Tarik Skubal. Last week, the New York Post's Jon Heyman, who is pretty plugged in with Skubal's agent, the infamous Scott Boras, reported that the Tigers basically have no chance to re-sign the Cy Young winner this offseason.
But teams like the Cubs, Red Sox, Mets, or Yankees that are already above the luxury tax threshold will all be in line to purchase his services this offseason.
And it's not even like the Tigers are some poor small-market team. This year, the Tigers are 11th in spending.
MLB's proposal won't automatically fix everything that is wrong with the sport, but there is a strong chance it could help.
Which MLB teams are over the cap? Which are under the salary floor?
On Wednesday, the MLBPA offered a set of economic proposals that it says are "designed to advance the rights and benefits of players at all levels."
Those proposals include a minimum salary increase to $1.5 million, expanded arbitration, enhanced protections and incentives for players entering arbitration, and safeguards against service time manipulation, among other changes.
On Thursday, Major League Baseball made its counteroffer.
MLB wants a salary cap of $245.3 million. In the past, that type of proposal would have led to an immediate lockout, as it did 30 years ago. But to sweeten the deal, the league is also offering concessions like a salary floor of $171.2 million, meaning cheap teams that don't spend on their players must start doing so.
Again, unlike other major American sports, MLB currently does not have a set revenue-sharing percentage for player compensation. But under the new proposal, players and owners would split league revenue evenly.
According to MLB, since 2003, league revenues have grown 247%, while player salaries have grown only 149%. And even those numbers are skewed by mega contracts like the ones Shoehei Ohtani, Juan Soto and Vladdy Guerrero just signed.
That salary cap includes benefit payments like pension contributions, health insurance and other benefits, so it isn't a simple matter of adding up payroll, but based on CBS Sports estimates using Cot's Contracts data, there are 9 teams that are over that cap in 2026.
The usual suspects are there at the top of the spending list.
- Los Angeles Dodgers - $420 million
- New York Mets - $379.2 million
- New York Yankees - $322.7 million
- Toronto Blue Jays - $322.7 million
- Philadelphia Phillies - $314.8 million
- Boston Red Sox - $268.7 million
- San Diego Padres - $259.2 million
- Atlanta Braves - $253.4 million
- Chicago Cubs - $249.7 million
There are 12 teams that fell below the proposed salary cap threshold this season, and once again, there aren't many surprises.
- Cincinnati Reds - $151.1 million
- Colorado Rockies - $141.9 million
- Las Vegas Athletics - $141.4 million
- Milwaukee Brewers - $139.7 million
- Pittsburgh Pirates - $138.5 million
- Minnesota Twins - $131.8 million
- Washington Nationals - $122.7 million
- St. Louis Cardinals - $112.9 million
- Tampa Bay Rays - $112.2 million
- Chicago Whit Sox - $11.7 million
- Cleveland Guardians - $88.8 million
- Miami Marlins - $82 million
The current collective bargaining agreement between the league and the players expires after this season.
Thanks to the salary cap proposal, there is a good chance that there is a lockout on the horizon. Just how long that lockout lasts depends on whether the players see the salary floor as a reasonable enough tradeoff for the salary cap.
Either way, professional baseball, and its wonky offseasons, probably won't be the same again.
Related: CJ Abrams matches historic Alex Rodriguez milestone
Copyright 2026 The Arena Group, Inc. All Rights Reserved.
This story was originally published May 29, 2026 at 8:49 AM.