Report: Reds to Cut Salaries, Furlough 25 Percent of Staff Through End of 2020May 14, 2020
The Cincinnati Reds joined numerous MLB teams forced to furlough staff and enact pay cuts for remaining employees on Thursday due to the COVID-19 pandemic, which has prevented the 2020 MLB regular season from beginning.
ESPN's Jeff Passan broke the news:
Jeff Passan @JeffPassan
The Cincinnati Reds are the latest team to enact pay cuts and furloughs, sources tell ESPN. The cuts are tiered, up to 20%, and last through the end of the year. Upward of 25% of the team’s employees will be furloughed. Similar moves are expected across baseball before June 1.
Other MLB teams have enacted furloughs and pay cuts in recent days.
Per an ESPN report on Wednesday, the Miami Marlins plan to furlough 90-100 employees beginning on June 1. Members of the executive team also took pay cuts, and CEO Derek Jeter will not take his salary.
The Associated Press reported on Tuesday, the Seattle Mariners will not furlough employees at least through Oct. 31, but some will see a five-month reduction in salary.
It's unclear if or when the MLB season will begin.
A proposal from MLB owners to players is on the table, and it consists of an 82-game season beginning in July following a shortened spring training session in June, per Joel Sherman of the New York Post. Games would be played at home ballparks without fans. The postseason would be expanded from 10 to 14 teams.
In that scenario, MLB teams still lose out on the billions in revenue brought in by fans. Per Elliott Morss of Morss Global Finance, all 30 teams totaled $2.26 billion in revenue at the gate in 2019.
That puts teams in a bind with the MLB season now delayed for nearly two months and no concrete timetable for a return in sight.
However, an agreement between owners and players on resuming play looks tenuous at best right now after the former group pushed a 50-50 revenue split in their offer.
Per Ken Rosenthal and Evan Drillich of The Athletic, one MLB official explained the stance and reasoning behind that:
"We lose money on every single game (without fans). We have to propose that they take something less than they already negotiated. We thought the most persuasive way to make that proposal was to explain: here's what we're going to make in revenue and we'll split it with you and here's how it turns into player salaries.
"You take everything, tell 'em this is everything we're going to make, we'll give you half of it. ... If we do better, we're not going to ask you to rely on our projections. We'll give you this as a minimum, if we make more, we'll give you half of what the more is."
MLBPA President Tony Clark made it clear that was not something the players would accept in comments to Ken Rosenthal and Evan Drillich of The Athletic:
"A system that restricts player pay based on revenues is a salary cap, period. This is not the first salary cap proposal our union has received. It probably won't be the last.
"That the league is trying to take advantage of a global health crisis to get what they've failed to achieve in the past—and to anonymously negotiate through the media for the last several days—suggests they know exactly how this will be received.
"None of this is beneficial to the process of finding a way for us to safely get back on the field and resume the 2020 season—which continues to be our sole focus."
Jesse Rogers of ESPN explained further why MLBPA would be vehemently opposed to such a deal as well.
"Fearful of those financial losses, owners approved a plan Monday that would pay players a percentage of their 2020 salaries based on a 50-50 split between players and owners of MLB's revenue from the regular season and postseason, sources told ESPN. The union views that concept as a salary cap, which it has said it will never agree to."
Also per Rogers, the MLB and MLBPA are at the negotiating table about regarding starting the 2020 season. The two sides met Wednesday, but topics of discussion centered around season logistics (e.g. roster sizes and spring training) rather than financial terms.