The Los Angeles Dodgers have signed Japanese right-handed star pitcher Kenta Maeda to an eight-year contract for a salary range over the deal from $25 million to $106.2 million (USD), plus the $20 million posting fee paid to his now former Japanese team.
The contract has many incentives and triggers for salary — all of which are based on Maeda’s on-field performance.
Basics: What you need to know about the Kenta Maeda contract?
If Kenta Maeda pitches 200 innings and makes 32 starts over the next eight-years he will make $106.2 million, plus the $20 million posting fee paid to his former Japanese team, max. With any other mix and match of good and bad seasons, Maeda will make between $25 million and $106 million. Maeda will have no arbitration years as they were bought with the contract. The Dodgers total guaranteed minimum investment: $45 million.
For context, via Baseball-Reference.com, here are Kenta Maeda’s main statistical performance categories over the last eight-years in Japan:
Kenta Maeda should have no issue (barring injury) reaching 200 innings pitched as he did so in Japan four of the eight-years he pitched there inside a six man rotation. Conversely, while stateside, Maeda will pitch in a five man rotation, every fifth day, and over a longer season (144 games in the Nippon Professional Baseball league to 162 games in Major League Baseball). If he is healthy, he will start 32 games, pitch 200 innings, and the Dodgers will be on the hook for $106.2 million.
Is the Kenta Maeda contract legal under the Basic Agreement and what does it mean for the future?
As a little background, the Major League Baseball Players Association has been referred to as the most powerful labor union in the world. This title is for good reason. What labor union has its members paid more and with guaranteed contracts? None. Not even close.
Is it legal?
First, the Basic Agreement does not forbid incentive-laden deals. Actually, the market being what it is with Tommy John surgeries being handed-out like In-N-Out cheeseburgers on a Saturday night, it would behoove teams to negotiate and secure incentive-laden deals, especially with pitchers, wherever possible.
Major League Baseball and the Major League Baseball Player’s Union does, however, forbid two very important types of contracts: personal service deals and milestone bonuses. (Examples: personal service deals like those handed out to Albert Pujols (Los Angeles Angels of Anaheim) and Ryan Zimmerman (Washington Nationals), both signed in 2012). Personal service deals promise a front office or similar type job to a player after their playing careers.
Alex Rodriguez (New York Yankees) is the most popular example of having a milestone bonus structure in his contract (located inside the $275 million renewal he signed in 2007). (Example: reaching Hank Aaron and Babe Ruth in homers, etc.).
Both types of contracts, or rather provisions inside contracts, were made illegal under the Basic Agreement after the above deals were struck. Apparently, Major League teams were trying to not add salary to avoid paying larger luxury tax figures since such figures were not subject to the tax.
So, incentive-laden contracts are permissible under the Basic Agreement. They are probably preferred on the team side.
Before we look at what the future may hold, we need to know from where we have come. How does the Kenta Maeda contract compare to other starting pitchers similarly situated?
In 2015, the Arizona Diamondbacks signed Zach Greinke to nearly six-times the guaranteed money as the Dodgers paid Kenta Maeda and the Diamondbacks have two less years of player control (six-year deal, $206 million for Greinke, eight-year deal, $25-106.2 million for Maeda).
In 2012, Japanese star pitcher Yu Darvish (Texas Rangers) signed for six-years, $60 million, but the Rangers also paid $51.7 million to his Japanese team for a total price tag of $111.7 million. About $4 million of the $60 million going to Darvish is not guaranteed money.
In 2014, Masahiro Tanaka, signed a seven-year deal for $155 million with the New York Yankees, plus a $20 million posting fee to his former Japanese team. A total package of $175 million.
Do you know what both Yu Darvish and Masahiro Tanaka have in common? 1. They were both far more expensive than Kenta Maeda. 2. They both have elbow problems: likely from throwing a slider (Darvish) and a splitter (Tanaka) that put a lot of strain on their elbows. Darvish is recovering from Tommy John surgery. Tanaka was shut down in 2015 to avoid a similar fate.
Guess what Kenta Maeda and the Dodgers have going for them? Only $25 million of guaranteed money and Maeda does not throw a slider or splitter as predominately as the aforementioned Japanese stars.
Maeda might be far less dominating than Darvish and Tanaka, but he also comes with a much smaller price tag. That said, Maeda projects to actually be on the field. What good is an investment like this if he is injured? Personally, I think Maeda is going to be an ace. Check out this video of him facing Major League stars in 2014. The Dodgers got a steal here as Maeda gets “paid” if he performs on the mound.