Rob Manfred, MLB Commissioner, warns the owners’ proposal for a salary cap could trigger a major work stoppage, reminiscent of the 1994 strike that canceled the World Series. Manfred, who worked as a junior lawyer for owners during those negotiations, says the current luxury tax (CBT)-which hit a record $402.6 million in taxes from 9 teams in 2025-has failed to ensure competitive balance.
Owners have proposed a $245.3 million cap for 2027, with a $171.2 million floor, forcing low-spending teams like Miami ($81.8M opening day payroll) to invest more. The players’ union, led by Bruce Meyer, argues the plan would have cost players over half a billion dollars in 2026.
A 50-50 revenue split proposal and escrow system are also on the table. Manfred insists the proposal is meant to address fan concerns about competitive balance, especially since no small-market team has won the World Series since the 2015 Kansas City Royals.
Meanwhile, MLB will not consider expansion to cities like Charlotte, Nashville, or Portland until a new CBA is signed. The league is also exploring a decision on sending players to the 2028 Los Angeles Olympics, but Meyer warns a work stoppage could disrupt those plans. Local broadcast revenue pooling is tied to the salary cap proposal as regional sports networks decline.
The current CBA expires Dec 1, 2025. Management is expected to impose a lockout if no deal is reached.