Transactions
Helping us (and you) understand the transactions that happen so commonly in baseball.
Navigation
25 / 40 man roster
Disabled List
Rehab
September Call Ups
Free Agency and Salary Arbitration
Minor League Free Agency
Trades
Waivers
Designated for Assignment
Rule 5 Draft
25/40 man roster
Each Major League Baseball team maintains both a 25-man roster and a 40-man roster of players, year-round.
The 25-man roster is the list of eligible players who may play in a game. The 40-man roster includes the 25-man roster plus players in the minor leagues as well as players on the 15-day disabled list. Teams typically try to place less then the max number of players on the 40 man roster, so they have space for future transactions. This is especially common at the end of the season during the free agent period.
Disabled list
If a major league player cannot play because of a medical condition, he may be placed on the 15-day disabled list. The team then frees up a spot on their active major league roster, and the player may not play for at least 15 consecutive days.
An injured player may also be placed on the 60-day disabled list. The team then frees up a spot on both the active major-league roster and the 40-man roster; the player may not play for at least 60 consecutive days. Players placed on the 15-day disabled list may be moved to the 60-day list at any time, but not vice versa.
Players may be placed on either disabled list retroactively for a minimum of 10 inactive days and may remain on either list for as long as required to recover. Injured players may not be traded without permission of the Commissioner nor may they be optioned to the minors, though they may be assigned to a minor league club for rehabilitation for a limited amount of time (30 days for pitchers, 20 for non-pitchers).
Rehab
Players on the Disabled List (DL) may be sent to the minors prior to returning to a big league club. Just because a player was in the majors does not mean he will rehab at the Triple-A level. Teams base where they send players to rehab based on geography, facilities also.
September Call Ups
From September 1st through the end of the regular season, active rosters are expanded to a limit of 40 players. Teams are allowed to call up to 15 players up as long as they are on the 40 man roster. This allows teams to evaluate players for next season as well as reward players for their hard work in the minors. Teams not in playoff chases can take the biggest advantage of this.
Free agency and salary arbitration
If a player is drafted and is offered a contract by his drafting team (or any team he is traded to) each year, he may not become a free agent until he has been on a major league roster or disabled list for at least six years. Otherwise, any player without a contract may become a free agent and sign with any team.
A player is eligible for salary arbitration if he:
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- is ineligible for free agency
- is without a contract
- cannot agree with his current team on a new contract
- has been on a major league roster or disabled list for at least three years
In this process, the player and the team both submit a salary offer for a new contract; the arbitrator chooses one number or the other, whichever is thought to be most “fair” given comparable wages among players with similar ability and service time. Players thus rely on arbitration and free agency to increase their salaries.
Players eligible for neither free agency nor salary arbitration are very seldom offered contracts for much more than the league minimum salary, as the player has no recourse to try to obtain a better salary elsewhere. For this reason, in the first three major league years of their careers, players accept comparatively low salaries. Some teams have made it a practice to try and lock up younger players to long term contracts during these years. This gives the player more money up front and if the player does pan out will save the team money in the later eyars of the contract.
Minor League Free Agency
If a player is on the 40 man roster but not on the active Major League roster is he considered to be on optional assignment meaning the team may move him between the big league club and the minors. If the player remains on the 40-man roster and not the active 25 man roster for any part of more than three seasons, he is out of options and may not be assigned to the minors without first clearing waivers. If a major league player is ineligible for free agency and “has options” remaining, his team may option him to a minor league team without consequence.
Another common instance is an older player signing a minor league deal with a team for one season. If he doesn’t make it to the Majors he is considered a free agent at the end of his contract.
Trades
Teams may trade only players currently under contract, except those players who have been drafted in the last year. From the end of the previous World Series through July, trades between two or more major league teams may freely occur at any time. In August, trades may only be made after all players in the trade clear waivers or are not on 40-man rosters. Players acquired after August 31 are ineligible for the postseason roster, unless they replace an injured player. While draft picks are not allowed to be traded teams are allowed to trade up to 1 million dollars in cash, anything above 1 million requires permission from the commissioners office.
- The 10/5 Rule
If a player has been on an active major league roster for ten full seasons and on one team for the last five, he may not be traded to another team without his consent (known as the 10/5 rule). Additionally, some players negotiate to have no-trade clauses in their contracts that have the same effect. Player to be named later
Some trades have the famous “player to be named later” (PTBNL) included in them. This player usually turns out to be a minor leaguer. This happens when two general managers can not agree on a specific player or the player they agree on is not allowed to be traded during this time. (waivers, ect) The player must be named within six months, sometimes cash or other considerations take the place of the player to be named. A few players have actually been returned to their former team as the player to be named later.
Waivers
Any player under contract may be placed on waivers at any time. If a player is waived, any team may claim him. If more than one team claims a player from waivers, the team with the worst record in the player’s league gets preference. If no team in the player’s league claims him, the claiming team with the worst record in the other league gets preference. The previous year’s standings are used during the first month of a season to determine preference.
If a team claims a player off waivers and has the viable claim as described above, his first team may choose one of the following:
- Arrange a trade with the new team for that player within two business days of the claim; or
rescind the request and keep the player on their major league roster, effectively canceling the waiver; or
do nothing and allow the claiming team to assume the player’s existing contract, pay a waiver fee to the first team, and place him on their active major league roster
If a player is claimed and the option to rescind is used, this option to rescind a waiver may not be used again for that player in that season. If no team claims a player from waivers in three business days, the player has cleared waivers and may be assigned to a minor league team, traded, or released outright.
The waiver report is often kept secret between Major League Baseball clubs; no announcement of a waiver is made until a transaction actually occurs. Many players are often quietly waived during the August “waiver-required” trading period to gauge trade interest in a particular player. Usually, when the player is claimed, the waiving team will rescind the waiver to avoid losing the player unless a trade can be worked out with the claiming team.
Designated for assignment
When a player is designated for assignment, he is immediately removed from the club’s 40-man roster. The club has 10 days to decide what to do with the player while freeing up a roster spot for another transaction, if needed. After designating a player for assignment, the club must make one of the following contractual moves.
- Place the player on waivers
Typically a player is placed on waivers after being designated for assignment for the purpose of out righting him to one of the club’s minor league teams. However, a player must clear waivers (that is, not get claimed by another team) to be sent to a minor league team. Also, if the player has five or more years of major league service, he must give consent to be assigned to the minors. If the player withholds consent, the team must either release him or keep him on the major league roster. In either case, the player must continue to be paid under the terms of his contract. Trade the player
Once a player is designated for assignment, he may be traded. Some teams have been known to designate players for assignment to increase interest in the player, especially among teams that are not at the top of the list for waivers. Often teams will take a lower quality player in return just to rid themselves of the current players contract.
Release the player
If a player is not traded, and clears waivers, he may be released from the team. The player is then a free agent and is able to sign with any of the 30 Major League teams, including the team that just released him. The team that releases him, is responsible for the salary the player is owed, less what the team that signs him pays him.
Rule 5 Draft
Occurring during the annual Winter Meeting of general managers, the purpose of the Rule5 draft is to prevent any one team from stockpiling too many talented young players in farm system. Any player that has played professional baseball for more than 4 years (or more than 5 years if signed at the age of 18 or younger) is eligible for the draft, provided he is not on a team’s 40-man roster.
No team is required to choose a player in the draft, but many do. If chosen, the player must be kept on the selecting team’s 25-man major league roster for the entire season after the draft-he may not be optioned or designated to the minors. The selecting team may, at any time, waive the rule 5 draftee, such as when they no longer wish to keep them on their major league roster. If a rule 5 draftee clears waivers, he must be offered back to the original team, effectively canceling the rule 5 draft choice. Once a rule 5 draftee spends an entire season on his new team’s 25-man roster, his status reverts to normal and he may be optioned or designated for assignment. To prevent the abuse of the rule 5 draft, the rule also states that the draftee must be active for at least 90 days. This keeps teams from drafting players, then “hiding” them on the disabled list for the majority of the season. For example, if a rule 5 draftee was only active for 67 days in his first season with his new club, he must be active for an additional 23 games in his second season to satisfy the rule 5 requirements.
Any player chosen in the rule 5 draft may be traded to any team while under the rule 5 restrictions, but the restrictions transfer to the new team-if the new team does not want to keep the player on their 25-man roster for the season, he must be offered back to the team he was on when he was chosen in the draft.
The intent of the rule 5 draft is to prevent teams from holding major league-potential players in the minor leagues when other teams would be willing to have them play in the majors. However, this draft has also become an opportunity for a team to take a top prospect from another team who might not be ready for the major leagues. Some recent rule 5 picks include Johan Santana and Dan Uggla.
To prevent excessive turnover at the minor league level, each draftee costs $50,000. If the draftee does not stay on the drafting team’s 25-man (major league) roster all season, the player must be offered back to his original team at half-price. AAA teams can also draft players from AA or lower for $12,000 and AA teams can draft from A teams or lower for $4,000.
The Rule 5 Draft is named for its place in the Professional Baseball Agreement. It follows the regular major league baseball draft, which is defined in the rulebook in Rule 4.