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Friday, April 20, 2012
MLB, union revise contract terms

By Jayson Stark
ESPN.com

Major League Baseball and the players' association have informed teams and agents that they no longer will approve personal-service deals and special "milestone" bonus clauses similar to those contained in Albert Pujols' contract with the Los Angeles Angels, officials of both agencies told ESPN.com.

MLB and the union agreed to the changes this month in the wake of Pujols' 10-year, $240 million contract and Ryan Zimmerman's six-year, $100 million extension with the Washington Nationals, which also contains a personal-services option following his playing career.

The contracts of Pujols and Zimmerman, as well as the milestone-bonus "marketing" package in Alex Rodriguez's 2007 contract with the Yankees, won't be affected by the new rules, said Dan Halem, MLB's senior vice president of labor relations. But no future contracts containing similar provisions will be allowed, Halem said.

Michael Weiner, executive director of the players' union, also confirmed the new rules. "Both clauses raise questions under the Basic Agreement, and both parties felt they should not be a subject of individual negotiations," Weiner said.

Rob Manfred, MLB's executive vice president for economics and league affairs, told ESPN.com that the two sides began talking about implementing the new rules this past winter because of growing concerns that arose from the language in Pujols' and Zimmerman's contracts.

The "milestone" bonus in Pujols' deal could pay him up to $10 million in "marketing" payouts -- $3 million for his 3,000th hit, another $7 million if he breaks Barry Bonds' all-time home-run record.

The league and the union have agreed that bonuses such as those violate a provision in baseball's basic agreement that prohibits contract incentives based on virtually all statistical achievements.

Pujols also has the option to accept a 10-year, $10 million personal-services contract with the Angels once he retires as an active player, and Zimmerman's new extension contains the option for a five-year, $10 million personal-services deal.

However, the two sides have concluded that the Basic Agreement doesn't permit players to agree to contracts that cover obligations beyond their playing careers.

One source told ESPN.com that baseball is trying to close loopholes that teams might be able to use to avoid paying a luxury tax, and both of these provisions fall under that heading because neither milestone bonuses nor personal-services deals are considered to be guaranteed money.