Cleveland Indians Have Leverage in Corey Kluber Negotiations

Cleveland Indians and Corey Kluber Hoping to Reach an Agreement

One of the continuing subplots during spring training has been the contract situation of the Indians’ incumbent ace, Corey Kluber. It’s a simple situation on the surface. Kluber and his agent want the security of a long-term deal while the Indians have to weigh the pros and cons of such an agreement. If this sounds familiar, it’s because the Indians found themselves in the same situation last season with then incumbent ace, Justin Masterson.

Or did they?

In the simplest of terms, the situation is the same. A player wants to get paid and the Indians have to figure out how much and for how long. The only difference, and this is critical in truly understanding the situation, is that Justin Masterson was due to hit free agency at season’s end. He could hit the open market and sign with the highest bidder, leaving the Indians empty-handed. Kluber on the other hand has no such leverage. In fact, this time around the Indians hold all the cards.

Aug 21, 2014; Minneapolis, MN, USA; Cleveland Indians starting pitcher Corey Kluber (28) pitches in the fourth inning against the Minnesota Twins at Target Field. The Minnesota Twins win 4-1. Mandatory Credit: Brad Rempel-USA TODAY Sports

The one year contract the Indians and Kluber recently agreed to is nowhere near an accurate estimation of his true worth. Kluber knows it, his agent, B.B. Abbott, knows it, and the Indians know it. While the financial terms of the deal were not disclosed, it is likely that they were higher than the $514,000 he made in 2014. Had Kluber not agreed to the one year pact, he would have been paid an amount determined by the Indians.

The reason for this is that Kluber has yet to become arbitration eligible. For once, the arbitration system, one of the quirks of Major League Baseball, is finally working in the Tribe’s favor. Because of Kluber’s current situation, he will remain under team control of the Indians through 2018. At 29-years-old, that means Kluber will be entering his age 33 season when he finally hits the free agent market.

That leaves the Indians with one of two decisions to make. Either they hold off on extending Kluber and paying him big-time money, or they take a gamble and lock him up with a multi-year contract. There are pros and cons to both scenarios, but again, the Indians have all the leverage.

Because Kluber was such a late bloomer, the Indians are under no obligation to pay him. They can simply allow the process to run its course and see what happens. If Kluber continues on his current progression, meaning he continues to be counted among the best pitchers in baseball, the Indians could agree to terms on a yearly basis or pay market value for Kluber’s services as determined by an arbiter.

While that could result in being forced to pay huge sums of money and possibly sacrificing their own financial flexibility, it also provides them with some security. While Kluber has been consistent over the past two seasons, he was never projected to be as good as he has been. By working year to year, the Indians could potentially protect themselves from committing multiple years and big money to someone who may be just as likely to regress over the next four seasons.

It’s the same dilemma they faced with Masterson. Either pay the man and risk being wrong, or take your chances and hope you come out on the positive side of things. WIth Masterson, the Indians guessed correctly. They refused to pay him, he tanked in 2014, was eventually traded, and is now fighting for a spot in Boston’s starting rotation. Could the same not hold true for Kluber eventually? It’s this type of guessing game that often makes front offices look like a group of geniuses or fool hardy jack wagons.

However, while the Indians hold all of the leverage, there is something to be said for making the commitment to Kluber, or any player for that matter, long-term. While the risk of signing a player to such a contract is high, if it works out it can be incredibly beneficial to both sides. By extending Kluber to a long-term deal, the Indians would be offering him not just financial security and ease of mind, but also a commitment that “you are our guy.” By eliminating the distraction of the hovering contract situation, extending Kluber would allow him to do what he is best at. Pitching. Nothing else.

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Because of the leverage the Indians hold over Kluber and his agent, they can propose a contract that will offer Kluber financial security while also protecting themselves from long-term financial risks. If Kluber were to hit the open market today, it is likely he could fetch a nine-figure contract from a team desperate to make a big splash. However, that is not the case for the Indians.

The Indians could offer Kluber a reasonably team friendly contract in the neighborhood of five years at $10-million per year. They could also front load the contract to ensure the bulk of the money is paid while Kluber is entering his prime. This would allow them the flexibility to get out from under the contract and move him in a trade should either Kluber’s performance or the Indians goals change in the coming years. And, because of Kluber’s age and free agent eligibility, there is no guarantee he will be able to find a contract anywhere near that amount after the 2018 season. Again, that’s leverage tipping even more favorably in the Indians’ favor.

So, with B.B. Abbott in Goodyear this week to meet with Chris Antonetti and the rest of the Indians’ brass, don’t be surprised if rumors around Kluber’s potential contract extension intensify. Abbott will want to cash in on his client’s 2014 performance and strike while the iron is still hot. And while it is possible that both Abbott and Kluber may be willing to gamble on his 2015 performance, it remains more likely that they agree to terms should the Indians present them with a reasonable contract offer.

Stay tuned folks, The Price is Right: Cleveland Indians Edition is just starting to get good.

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