I Think That a MLB Salary Cap is Coming

By EJ Fagan

May 30, 2026

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The following post comes from EJ Fagan's Substack, Baseball Is Life. It is shared with permission.

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Via Reddit and the Athletic. The owners have made their opening proposal:

Ignore the spin claiming that they have fans on their side. The owners are proposing a 50/50 revenue split, which comes out to a salary cap around $250 million and a floor around $170 million.

Obviously, there are fine details here that matter. What is baseball revenue? What is salary? But the ultimately what matters is that the league is proposing a 50/50 split with the players and a pretty high floor to guarantee that they get there.

It’s a serious offer. MLB payrolls are significantly below 50% - I’ve seen estimates ranging from 48% to 42%. In the short term, players would stand to gain from the new economic system. In the longer term, future CBAs may attempt to reduce the revenue split or monkey with the details. But most currently players will be long gone by that time. I have a hard time seeing the MLBPA sustaining a work stoppage when the alternative is more money for their members.

It’s also their first offer, not their final one. They expect the players to counteroffer and ask for more, or at least to shape the details in a way that benefits them. I don’t expect the players to immediately agree to a salary cap framework, but I now wouldn’t be shocked if they end up there eventually.

The system is basically identical to the NHL system, with a high floor and low ceiling for teams. I think it’s worth pointing out what the NHL had to do to make that system work:

• Significantly reduce the age of free agency

• Significantly increase the salary earned by players in their arbitration years

• Allow teams to periodically buy out bad contracts for a reduced cap hit

• Put rules in place to prevent salary cap manipulation with players nearing retirement

• Limitations on contract length

  
  

Basically, once you have a guaranteed revenue split, it doesn’t really matter to MLB what the free agency or arbitration rules are. Players would enjoy more freedom to choose where they play. Players who wouldn’t generally make it to the status quo free agency would get an earlier payday.

Long term, this system is obviously bad for the Yankees. Today they can outspend most of their competitors and face much less competition for free agents. Not under a cap system. They can make up some of that gap by spending to the cap every year, investing outside of the payroll and offering players some New York prestige or endorsements, but not all of it.

What about the short term? The Yankees have $207 million committed for 2028 and $171 million for 2028. They don’t have any huge arbitration raises coming, but will probably need to trade some guys to get under it. Some teams will need some raw payroll to get up to $171, so you could imagine someone taking some underwater contracts off their hands like Rodon, Stanton or McMahon.

I have trouble seeing the Yankees having room for Jazz Chisholm in a capped system. They would have to ditch some luxuries on their roster, like paying Clark Schmidt $4.5 million to rehab or having two C+ starting shortstops on the roster. And they would definitely need to get rid of one of Cole, Rodon or Fried. I wonder if the CBA would temporarily eliminate no trade clauses to make this all work.

Realistically though, any new cap would need a phase in period, especially if the agreement goes down to the wire before the 2027 season. The Yankees don’t have a ton of commitments past 2028. Their long term commitments to Fried and Judge might sting for a bit though.

Other teams are in even worse shape. The Mets have $160 million locked in just Soto, Lindor, Bichette and Semien. The Dodgers have a similar amount going to Tucker, Ohtani, Snell and Glasnow. A lot of these guys are going to have to end up on the Marlins, Guardians and Rays before a cap/floor is in effect. I think the teams which gave weird high-AAV contracts to Bichette and Tucker were anticipating a salary cap that hits in 2029.

Brace yourselves. A cap is looking increasingly likely to me.