OK, here are the rules, and my commentary.
1. Yearly salaries within any multi-year contract offer (as a free agent or as an extension of an existing contract) may never decrease. Salaries may only be at or above the value of the previous season’s salary within a multi-year contract offer. While not a requisite, GMs are strongly encouraged to realistically escalate salaries over the life of a multi-year contract.
I think this rule should be eliminated. At one point, the IRL justification was probably true, but it no longer is. IRL, there are plenty of contracts, particularly for veterans, that have flat and/or declining contract values.
2. The salary in the first year of an extension must be at or above the value of the player’s current year salary. If you wish to sign the player to a contract with a salary lower than what he is currently making, you must first let him test free agency. Once a player reaches free agency, you may offer him whatever you like.
I think this is a fine rule, and it appears not to have been violated.
3. Extensions of three or more years in length must adhere to the following minimum salary restrictions:
All contract years that cover a player’s arbitration years must feature a salary at least equal to the league average salary.
All contract years that cover a player’s free agency years must feature a salary at least triple the league average salary.
For the purpose of calculating contract years, an option year will counted as a contract year.
I think that this is a pretty important rule to keep, at least with respect to players who have not yet met free agency. (I will admit, however, that I think that we have a tendency to get more upset about "extended" salaries during the six years when a team controls a player than is prudent - with the exception of the top 1% or 2% of players for whom team's might make out like bandits, teams get and are supposed to get good value in those years out of a contract - that's a feature, not a bug.) If we wanted to simplify, I'd be happy to modify the rule as follows:
Extensions of three or more years in length given to any player prior to that player's last off-season of arbitration must adhere to the following minimum salary restrictions:
All contract years that cover a player’s arbitration years must feature a salary at least equal to the league average salary.
All contract years that cover a player’s free agency years must feature a salary at least triple the league average salary.
No such extension can cover more than one of a player's free agency years [unless the second and later free agency years are subject to a player opt-out or player options and under no circumstances shall an extension cover more than three of a player's free agency years.]
For the purpose of calculating contract years, an option year will counted as a contract year.
Exception : Between the conclusion of a league’s playoffs and the arrival of free agency, qualifying veterans may be offered a 1-year contract at a salary no less than 75% of the player’s current salary. The qualifications are as follows:
Player is at least 33 years old as of the conclusion of a league’s playoffs
Player has a Loyalty rating of “Normal” or higher
Player has enough service time to qualify for free agency
Player has signed at least one previous major league contract with his current team
Player has been under major league contract with his current team for the previous three consecutive seasons or six total seasons
I'm pretty agnostic on this rule either way. It feels like it should be relaxed, if not eliminated, to me. But I never have any old players who are worth a darn, so I may not be the best to consult on this one.
4. Teams may not sign a player to a major league extension within 45 days of his signing a major league contract. A brief cool-down period is required before a new contract may be extended.
This seems logical, and hasn't been violated. If it ain't broke, don't fix it.
5. If a contract with a player is voided, the GM’s next contract offer to the player must feature a guaranteed average yearly salary at least 150% of the average salary of the previous offer (including option years).
This hasn't been enforced. I think if we can streamline the rules, it probably should be enforced, except for de minimis violations. (I would call the Cards' Paul DeJong contract above a de minimis violation, missing the amount in two contraact years by ~$400K.)
Bonus Clauses: Bonus clauses in contracts are governed by several house rules, both for free agents and extensions. Contracts in violation of these rules are subject to review by the Board, which reserves the right to void the contract. If you wish to offer a contract that breaks one or more of these rules, contact the Board prior to making the offer to explain your intent. You will be provided with guidance on an agreeable contract offer.
1. Players must meet a minimum average guaranteed salary value in order to qualify to be offered Royal Raker or Golden Arm bonus.
Contracts require an average guaranteed yearly salary value of at least $5M to qualify for award bonus offers.
Example: GMs are allowed to offer a Royal Raker bonus along with a contract offer of $4M for 2010, $5M for 2011 and $6M for 2012 (average value of $5M). If the $6M for 2012 is absent from the offer (dropping the average value
I'm ambivalent on this one, but if we believe that there is a loophole in the way that OOTP values these bonuses, then I'm fine with a once per season (in the offseason) enforcement mechanism indicated in 5 below rather than voiding contracts.
2. PA/IP bonuses can be given to any player, up to 650 PA / 200 IP.
This seems pretty lenient. I might match-up the vesting bonus thresholds indicated below with the PA/IP bonuses.
3. The cap on the amount of total bonus money that may be offered is 25% of the highest guaranteed yearly salary in the contract.
Example: In a contract offer of $5M for 2010, $6M for 2011 and a $7M option for 2012, a GM may offer bonuses up to $1.5M (25% of $6M, the highest guaranteed yearly salary in the contract).
Same comment as 1 in this same bonus list above.
4. From June 6th until the end of the PEBA playoffs, bonuses may only be offered to free agents if the contract spans multiple seasons.
This seems like a keeper.
5. If a contract features an illegal bonus, the bonus will be added to yearly salaries. Example: GMs cannot include Royal Raker or Golden Arm bonuses unless the average guaranteed yearly salary value of the contract is at least $5M. If a PEBA team signs a contract with a player that features an average guaranteed yearly salary value of $4.5M and includes a $1M Royal Raker bonus, that bonus will be eliminated and $1M will be added to the base salary of each season covered by the contract.
I think this is a good way to police this. It is a rule, and one that is oft-violated apparently.
Vesting, Player and Team Options
These are allowed in multi-year contracts subject to the following provisos
Player options must precede team options when both are offered in the same contract
Team options must include a buyout fee of at least 25% of that year's salary
Vesting options must be realistic. You cannot ask for more than PITCHERS 30 games started, 180 IP (starters) , 20 games finished (Relievers). BATTERS 450 AB, 120 games played.
I think that this is all fine, except that the 25% buyout minimum seems a bit too high to me. You often see $1M to $2M buyouts in $12.5M-$15M contract years IRL. That's pretty small beer, though, and probably not worth a rule change. This is the second-most violated rule, it appears, after the minimum-contract-value-for-award-bonus rule. I think it is probably a more important rule to have in extension offers than in the open free agent market. In any event, I vote to keep and to educate.