It's Time for Baseball to Reform the Rule 5 Draft

Opening Day is a crow hop away, and that can mean only one thing: most Rule 5 picks are about to return to their source. A few already have. The Braves, for instance, sent lefty reliever Evan Rutckyj and his gratuitous consonant back to the Yankees on March 18. No matter what happens between now and the roster-setting deadline, each player drafted has lived through one of baseball's oldest and oddest experiences.

The Rule 5 draft has been around for more than a century. Most people know it as the quirky mechanism that launched big-league careers for Roberto Clemente, Johan Santana, and Josh Hamilton; others as the time-wasting exercise baseball executives partake in before leaving the winter meetings. Either way, here's how it works: Teams have so many winters following a player's signing before they must add them to the 40-man roster to protect them from inclusion in the Rule 5 draft. Those players left unprotected can be selected by any other team, with the catch being that the new team has to keep the player on the 25-man roster all season (or 90 days, in the case of severely injured players); otherwise, the original team can reacquire the player at a reduced cost (and without the 25-man roster spot).

Purportedly, the Rule 5 draft is intended to serve at least one of two purposes: 1) gifting opportunities to players who wouldn't otherwise receive them, and 2) preventing teams from hoarding talent. The problem is that it doesn't accomplish either goal.

Consider the story of Oscar Hernandez, the top pick in the 2015 Rule 5 draft (who was overshadowed last season by Odubel Herrera and Delino DeShields Jr., a pair of Rule 5 success stories). The Diamondbacks selected him from the Rays and when he suffered a broken hamate bone during spring training, in a perverse way they benefitted. That injury allowed Arizona to manipulate Hernandez's rehab stints, ensuring he would finish with more appearances in the minors than the majors, and with enough service time to cancel out the 25-man requirement. He didn't have to make the earnest leap from Class-A to the majors. This spring, without any legislation forcing their hand, the Diamondbacks farmed out Hernandez to High-A on March 7, after just two spring plate appearances.

If that seems like a lot of headache for both parties to endure, that's because it is―and much of it could be prevented in similar future cases with some long overdue Rule 5 draft reform. Those aren't the only reasons a systematic makeover is needed, however.

From the players' perspective, there is no such thing as a good draft. The majority of Rule 5–eligible players fall into the awkward crack between prospects deemed worthy of inclusion on the 40-man roster and minor-league free agents who work on year-to-year agreements. There are exceptions―sometimes a young, extremely raw player (like Hernandez) is left exposed on the grounds that he'd be hard to carry on the 25-man roster all summer―but, for the most part, the Rule 5 picks are often future minor-league free agents without the service time to pick their own employer. They are the class of ballplayers with the least earning power in the sport.

As a result, being plucked in the Rule 5 draft looks like a perk at first glance. You get to attend big-league camp, play in big-league exhibition games, and perhaps earn a spot on a big-league roster and, best of all, a big-league paycheck (note that players are not paid their regular salary during spring training, so this only applies to those who make the final cut). There's also the psychological benefit of knowing that someone thinks well of your talents. But the downsides are innumerable, beginning with the reality that those Rule 5 picks who crack rosters are often ensconced in low-leverage, low-opportunity roles on the bench or in the bullpen―roles that can lead to inconsistent playing time and potentially stunted development.

Perhaps those drawbacks don't matter to the greater part of the Rule 5 class, the players who aspire to become the future middle relievers and utility infielders of America, but other minuses do. The draft's winners (the players who stick all season) are often jettisoned to the minors the ensuing spring―provided, that is, that they avoid being exposed to what can be a hectic, disruptive waiver-wire process.

Teams have incentive to change the current setup, too. The Rule 5 draft fails as a talent dispersal system because it forces clubs to play shadow games with the DL, or to effectively roll with a 24-man roster. Neither situation is a positive for the team or player involved.

So how do you fix this whole mess? Two changes less radical than abolishing the Rule 5 draft would improve everything: increasing the cost of each draft pick, and doing away with the rules that state a player must remain on the 25-man roster for an entire season.

Teams have been paying $50,000 per Rule 5 pick since 1985. There's no apparent reason why, in a league where the costs of all other modes of talent addition have skyrocketed, this figure would remain set in stone for three decades. If that cost were doubled, teams would essentially be paying a quarter of the minimum big-league salary to add a player, or five times that of a waiver claim.

Increasing the cost would result in fewer picks, which leads us to the second change: reconfiguring the rights of the selecting team. The path of least resistance suggests the ideal fix would be to stipulate that players must remain on the 40-man roster for an entire season. That maintains the numbers game element that comes with roster management, and accomplishes three other things:

1) It doesn't handicap the selecting team or selected player (since they could be optioned to the minors, where they could play more often).

2) It gives the player a raise (since being on the 40-man means higher pay, albeit not as high as being on the 25-man).

3) It gives the player's original team a greater sum in exchange for losing talent.

Theoretically, you could add all kinds of other stipulations, like basing the amount owed to the original team on how much service time the player accrues. But you have to be careful, since we know that trusting teams to honor the spirit of the game when there's money on the line is about as naive as exposing your nape around a vampire. You might also consider capping the number of picks a team can make, since it's easier to house players on the 40-man, yet think about it this way: the more Rule 5 picks on a team's roster, the more likely one (or two!) of those receives a legitimate opportunity. Isn't that a good thing?

Perhaps more than anything, Major League Baseball needs to answer that question. Because as it stands, it's not clear whether the Rule 5 Draft is meant to serve the players, the teams, or both. What is clear is that it's not serving any of them as well as it could with some minor adjustments.