Chicago Cubs can thank draft pick compensation for Dexter Fowler’s surprise reunion with the Cubs in 2016.
When a player becomes a free agent their team has the option to offer that player a one year contract called a qualifying offer. If the player refuses the qualifying offer and then signs with another team the player’s new team loses a draft pick and the original team gets draft pick compensation in the next amateur draft.
It used to be that these draft picks were first round draft picks. But in the last revision to the collective bargaining agreement, these picks could vary depending on the market size of the team. The worst draft pick a team can now lose is a second round pick.
Players also can now only receive a qualifying offer once in their career. Thus a player can only be tied to draft pick compensation once.
In recent years this has impacted the Cubs and Cubs players quite a bit. When the Cubs signed Jason Heyward and John Lackey before the 2016 season, the Cubs lost their two highest draft picks that year because both players declined qualifying offers.
After the 2016 season, the Cubs received an additional draft pick at the end of the first round because Dexter Fowler signed with the St. Louis Cardinals. However, after the 2017 season, and the changes to the CBA, the Cubs only received two second-round picks when both Jake Arrieta and Wade Davis signed with other teams.
But the poster child for a change to this system is Fowler. After the 2015 season, he declined the Cubs qualifying offer. That offseason it appeared Fowler was going to sign a multi-year deal with the Baltimore Orioles. But when at the last minute the Orioles demanded Fowler compensate them for the loss of a draft pick by accepting less money, he refused to sign with them.
Luckily this turned out to be good news for the Cubs, as it resulted in a surprise reunion with Fowler. Fowler went on to make big contributions that helped the Cubs win the 2016 World Series.
It seems clear to me that there is nothing wrong with giving the teams draft picks to compensate them for lost free agents. However, being tied to draft pick compensation can lower the value of free agents. I’m surprised that the players association agreed to it or that they failed to anticipate how it would negatively impact players’ salaries.