MLB waivers and options explained: the roster's back door

Two phrases carry more meaning per word than anything else on baseball's transaction wire, and both are routinely reported without explanation. One is that a player has been designated for assignment. The other is that he is out of options. Between them they decide which players a club can keep, which it must expose to the other twenty-nine, and which of its useful employees will be pitching somewhere else by Friday.

MLB waivers and options are the movement system underneath the roster limits. The limits themselves are simple: twenty-six active, forty on the reserve list, thirteen pitchers. What is not simple is how a name gets from one column to another, because every route between them is governed by a different rule, and several of those rules exist specifically to stop clubs doing something they used to do.

There is a further complication, which is that a great deal of what is written about baseball waivers describes a system that was abolished. The elaborate August ritual of revocable trade waivers, of players being placed and pulled back, of two clubs having forty-eight hours to work out a deal after a claim, is history. It has been gone for years. Any explanation that still describes it as current is describing the wrong sport.

An option is permission to move a player without asking anybody

Start with options, because they are the mechanism clubs use hundreds of times a season and waivers are the one they use when options have run out.

When a player is added to the 40-man roster, he acquires three option years. An option year is a season in which his club may send him to a minor league affiliate and recall him at will, without exposing him to any other club and without needing his agreement. That is the entire content of the right, and it is worth stating plainly because it is often described as something the player has rather than something the club has. He does not have options. His club does.

A conditional fourth option exists for players whose careers started slowly. If a player has not accrued five full seasons of professional experience by the end of his third option year, he gets another one. A full season for this purpose is a defined amount of time on an active list, in the majors or the minors, with a secondary route for players who spent much of a year injured. The clause is there for the player who signed at seventeen, spent two summers in the complex leagues and reached the 40-man early, and would otherwise run out of options before he had finished developing.

The counting is where people go wrong, and the rule is more forgiving than it sounds. An option year is only consumed if the player's optional assignments in that season total twenty days or more. Nineteen days or fewer and the option survives. And only one option can be used per season, however many separate trips he makes. A player sent down in April, recalled in May, sent down again in June and recalled in July has used one option year, not three.

That twenty-day threshold is the same number that appears in the service time rules, and the coincidence is not one. A short assignment costs the player nothing in days on his service ledger and costs the club nothing in option years. Cross twenty days and both meters start running. It is a single line drawn once and applied in two places, which is unusual in an agreement of this length and rather elegant when you notice it.

Assignments made before the season starts do not count against the in-season limits described below, which is why the last cuts of spring training are optional assignments rather than anything more dramatic for most of the players involved.

• 3Option years a player receives
• 20Days on assignment that burn one
• 5Optional assignments allowed per season
• 7Days in a designation for assignment window

Rule-defined limits under the current collective bargaining agreement. The fourth option is conditional on the player's professional experience.

The five-assignment limit ended the bullpen shuttle

For most of the last decade the most exploited feature of the option system was the shuttle. A club with a full complement of optionable relievers could treat its bullpen as a rotating stock: pitch a man on Tuesday, option him to Triple-A on Wednesday, bring up a fresh arm, and repeat. The player never left the organisation, the club never ran short of rested pitching, and the same three or four men spent the summer in airports.

Two rules have since been laid over it, and together they have largely killed it.

The first is a minimum stay. A position player who is optioned must remain in the minors for at least ten days before he can be recalled, and a pitcher for at least fifteen. There is a sensible exception: the minimum does not apply when a club is recalling somebody to replace a player who has gone on the injured list or been traded, because otherwise an injury on a Tuesday would leave a club a man short until the following week. The exception is narrow and the effect of the rule is broad. A pitcher sent down is gone for a fortnight, not a night.

The second is a cap on the number of trips. Under the current agreement a club may option any given player a maximum of five times in a season. Past that, moving him to the minors requires him to clear waivers first, which is a completely different proposition and one no club undertakes lightly. Five is generous enough for legitimate roster management and far too few for a shuttle.

The result is that the flexible bullpen has become an inventory problem rather than a conveyor belt. A club still moves relievers up and down, but it now has to plan which ones, because each has a limited stock of trips and a fifteen-day minimum attached to each trip. Managers who once thought about tomorrow's bullpen now think about August's.

One further right sits on top of all this and is easily missed. A player with five or more years of Major League service may refuse an optional assignment altogether. He cannot be sent down without his consent whatever his club's roster situation and whatever options remain on paper. Service time, which is usually discussed in terms of money, is also a source of straightforward veto power, and this is the first place a player acquires it.

Waiver request stays open2days

Designation for assignment window7days

Minimum stay after option, position player10days

Minimum stay after option, pitcher15days

Rule-defined minimums and windows. The recall minimums do not apply when the club is replacing a player who has gone on the injured list or been traded.

Show the numbers

The clocks attached to moving a player, in days

Item	Length
Waiver request stays open	2days
Designation for assignment window	7days
Minimum stay after option, position player	10days
Minimum stay after option, pitcher	15days

Waivers are far simpler than they used to be

Here is the part that most reference material gets wrong, so it is worth being blunt about what waivers now are.

A waiver request is an offer of a player to the rest of the league at a fixed price, which is nothing. His club files the request, it stays open for a short defined period, currently two business days, and during that window any of the other twenty-nine clubs may claim him. If somebody does, the player and his contract go to the claiming club, which puts him on its own 40-man roster and assumes every dollar still owed to him. The club that waived him receives no compensation. If nobody claims him, he has cleared, and his club may proceed with whatever it wanted to do.

Priority among claimants runs in reverse order of the standings, so the worst record gets first refusal. That ordering is the point of the whole exercise: waivers are a mechanism for redistributing players nobody wants to keep, and it distributes them downwards.

Two structural features distinguish this from the old system. The waivers that remain cannot be revoked. Once a claim is made, the club that filed the request cannot pull the player back and carry on as before, which is exactly what the old August trade waivers allowed and is the reason clubs used to run their entire roster through waivers every summer as a fishing expedition. And there is no longer any trading after the deadline. The single deadline in late July or early August is genuinely final, which removed the August waiver-trade market entirely and left the deadline itself carrying all the weight it now carries.

What remains, in practical terms, are two uses. Outright waivers, which a club must clear before it can assign a player to the minors when he has no options left, or has used all five of his assignments, or is not on the 40-man roster in the first place. And unconditional release waivers, which a club must clear before releasing a player outright. They are the same instrument pointed at different destinations.

• 29Clubs given the chance to claim
• 2Business days the request stays open
• 1Clubs that can be awarded a claim
• 0Compensation to the club that waived him

Structural counts rather than any particular transaction. The claiming club takes the contract as it stands.

Why the old system was abolished, and what it was actually for

The system that was thrown out deserves a paragraph, because knowing what it did explains why the current rules are shaped as they are.

Until a few years ago there were two trade deadlines. The first, at the end of July, was the non-waiver deadline. After it, a player could still be traded, but only if he first cleared trade waivers, and trade waivers were revocable. A club could place a player, see whether anybody claimed him, and if somebody did, either work out a trade with that specific club, let the claimant have him and his whole contract, or simply pull him back and pretend it had never happened.

Because the pull-back was free, clubs ran essentially their entire roster through waivers every August as a matter of routine. The purpose was information: find out who was interested in whom, at no cost and no risk. Reporters who covered the sport learned to ignore the resulting noise, because a player being placed on trade waivers meant almost nothing.

The month also produced a strange sub-market. A club could block a rival from acquiring a player by claiming him first, even with no intention of keeping him, which meant that a good deal of August activity was defensive rather than acquisitive. Deals still got done, but they got done through a filter that had nothing to do with which club wanted the player most.

Consolidating everything into a single deadline killed the whole apparatus, and the effect on how a season feels is larger than the rule change suggests. The deadline is now genuinely final. A club that has not fixed its roster by that afternoon does not get a second chance in August, which is why the deadline itself has become one of the loudest days on the calendar. The Commissioner sets the exact date each year within a defined window at the turn of July and August, and after it passes no player changes clubs by trade until the World Series is over.

What survived is the plumbing. Waivers still exist because a club still needs a way to remove somebody from the 40-man roster, and the league still needs those players offered around before they disappear into the minors. The August theatre was removed. The underlying mechanism was not.

The waiver year, the daily limit and other small print

A few procedural details govern how the system runs day to day, and they explain some otherwise peculiar patterns.

Waivers operate on a waiver year rather than a calendar or a season, and it opens well before Opening Day, which is how clubs are able to do their roster surgery through the winter and spring. The claiming order within it is rebuilt from the standings as the season produces them, with the previous season's finish doing the work until the current one means anything, and ties broken by the earlier year's record. A club that successfully claims somebody does not lose its place in the order, which matters more than it sounds: there is no penalty for being acquisitive on waivers, so a club with a bad record and an open roster spot can claim repeatedly.

There is a limit on volume. A club may only place a defined small number of players on waivers on any given day, which prevents the kind of mass filing the old August market encouraged and keeps the process legible to the other twenty-nine clubs.

Timing around the end of August also matters for reasons that reach into October. A player acquired by claim after the postseason eligibility date is not eligible for that club's postseason roster, so late-season claims are made with an eye on next year rather than this one. That single fact explains most of what happens on the wire in the first fortnight of September: contenders claiming nobody, and clubs out of the race claiming everybody.

What actually happens when a player is designated for assignment

1. 1The club designates him for assignmentHe comes off the 40-man roster the moment the designation is made, which is the entire purpose of the transaction. A seven-day clock starts, and the club must resolve his status inside it.
2. 2The club looks for a tradeWith a week to work in, clubs frequently find another club willing to give up something small rather than take its chances in the claiming order. A trade ends the process here and the player never reaches waivers.
3. 3The player is placed on waiversIf no trade materialises, the club files a waiver request. It stays open for a short fixed period, and every other club may put in a claim during it.
4. 4A club claims him, or nobody doesA claiming club takes him onto its own 40-man roster along with every dollar remaining on his contract. Where two or more clubs claim, the one with the worse record wins. If nobody claims, he clears.
5. 5He clears, and the club offers an outright assignmentClearing lets the club send him to a minor league affiliate, off the 40-man roster but still in the organisation. This is the outcome clubs are usually aiming for when they make the designation.
6. 6He accepts, or he elects free agencyA player with three or more years of service, or who has been outrighted before, may refuse the assignment and become a free agent instead. A player without that standing has no choice to make.

The club chooses the route. The player's service time decides how much say he has at the last step.

The seven days are not a formality. They are a genuine window in which a club works the phones, and a good number of designations end in a small trade precisely because the alternative for the acquiring club is to sit behind eight others in the claiming order and hope. The player, meanwhile, is in limbo: off the roster, not released, and unable to sign anywhere.

One point of order that trips people up. A designation is not itself a waiver request, and the two are separate transactions with separate clocks. A player can be designated and then traded without ever being placed on waivers at all. The reason the phrases run together in reporting is that most designations do end in waivers, but the sequence matters if you are trying to work out what a club is doing.

Clearing waivers is the normal outcome, and the reason is money

Most players who are placed on waivers clear them. That surprises people who assume twenty-nine clubs would jump at a free major leaguer, and the explanation is that he is not free.

A claim is an all-or-nothing acceptance of the contract as it stands. There is no negotiation, no split of the remaining salary, no ability to take the player and leave part of the money behind. A club claiming a struggling veteran with two years and a substantial sum still owed is buying the salary as well as the player, and it must also find a 40-man spot for him immediately, which means designating one of its own players and starting this whole process again from the top.

So the pattern is predictable once you see it. Players on modest salaries with useful skills get claimed. Players on large guaranteed contracts almost always clear, because baseball contracts are guaranteed to the last dollar and nobody wants the obligation. That is why a club stuck with an expensive player who is no longer good is stuck with him in every sense: it cannot cut the money, it cannot trade him without attaching cash or a prospect, and waivers will simply return him to its own hands after two days.

The same logic explains the deadline behaviour. A club wanting to shed salary in July must find a trade partner and usually pay for the privilege, because the waiver route offers no relief at all. And the amount still owed continues to count against the competitive balance tax whether he is on the roster, in the minors, or released, so the accounting does not improve either.

Unconditional release waivers work the same way with one difference: a released player is free to sign anywhere, and if he signs elsewhere the new club's salary offsets what his old club owes. The offset is usually small, because a released player signs for very little, but it is the only recovery available. Releasing a player under a guaranteed contract is writing off the money and buying a roster spot with it.

Outright assignment, and the rights a player earns by surviving

The end point of most waiver processes is an outright assignment: the player leaves the 40-man roster and is assigned to a minor league affiliate, where he remains the club's property. He can be recalled later, but only by putting him back on the 40, which requires a spot.

Whether he has to accept this depends on how long he has been in the major leagues, and the escalation is worth learning because it changes a player's position completely.

A player with fewer than three years of Major League service and no previous outright has no choice. He goes where he is sent.

A player with three or more years of service, or who has been outrighted at any point before, may refuse the assignment and elect free agency instead. That is a genuine decision rather than a formality, because electing free agency means walking away from what remains of a contract in exchange for the freedom to sign elsewhere. A player near the end of a guaranteed deal will usually accept the assignment and take the money. A player on a minimum salary with a market for his services will frequently walk.

A player with five or more years of service has the strongest position. He may refuse an outright assignment and elect free agency while keeping what is still owed to him, which means in practice that he cannot be sent to the minors at all. His club's only real choices are to keep him on the major league roster or to release him and pay him anyway.

There is also a second bite at the cherry. A player who accepts an outright assignment during the season and has the requisite service can elect free agency once the season ends, rather than being bound to the organisation indefinitely. The right exists so that accepting an assignment in June is not a permanent surrender of the choice.

Underneath all of this sits an obvious asymmetry. A player who has been in the majors for five years has meaningful control over where he works. A player who has been there for two has none, and the two may be equally good. Standing is earned by time served rather than by ability, which is the same principle that governs arbitration eligibility and, for the players below the 40-man line, the whole structure of the minor leagues.

One roster spot, four ways to make it, four different prices

An invented club needs an active roster place on a Tuesday afternoon for a pitcher it has just signed. It has four routes available and they cost wildly different things, which is the clearest way to see how the pieces fit.

Option somebody. The cheapest route by a distance, and the one clubs use most. It costs the player his major league salary for the duration and it costs the club one of that player's five permitted assignments for the season, plus an option year if the stay reaches twenty days. Nobody else in the league gets a look at him. The catch is that it only works on a player who still has options and fewer than five assignments used, which in September is frequently nobody at all.

Put somebody on the injured list. Free in roster terms and constrained by honesty. The short list keeps him on the 40-man, so it solves the active roster problem and not the reserve list problem. If the club also needs a 40-man spot and its roster is full, the long-term list solves both at once, which is why those placements cluster on days when a club has just signed someone.

Designate somebody for assignment. This solves both problems immediately and is the expensive route, because the player is now on offer to the rest of the league at no cost. A club takes it when the alternatives have run out and when it has decided it can live with losing him. It is also the only one of the four that starts a clock the club cannot stop.

Trade somebody. Solves both problems and recovers something, which is why the seven-day designation window exists at all. The market for a fringe roster player is thin and the return is usually nominal, but nominal beats nothing, and it takes the risk of a claim off the table.

Rank those four by cost to the club and the ordering is stable across the season: option, then injured list, then trade, then designation. Rank them by cost to the player and the ordering is close to reversed, because a designation at least puts him in front of twenty-nine clubs and an option simply sends him to Triple-A on Triple-A money. The routes a club prefers are the routes that keep the player and remove his choices, and the route a club takes last is the one that gives him the most.

Why an optionable arm is worth more than a better one

Put options and waivers together and you get a market distortion that shapes roster construction more than any scouting report.

Take two invented relievers, identical in age and identical in quality. One has two option years remaining. The other has none. The club must choose one for its final bullpen place.

It will keep the optionable one, and the reasoning is not close. The optionable reliever can be sent down when the club needs a fresh arm and recalled a fortnight later. He absorbs the roster's volatility. The reliever without options must occupy an active roster place every day of the season, and the moment the club wants to move him it must offer him to twenty-nine other clubs and will probably lose him.

Two players of exactly equal ability, one worth substantially more than the other, and the difference is a piece of administrative status neither of them chose. Clubs price it explicitly in trades, front offices list it beside velocity in internal notes, and it is entirely invisible in any statistical record of what a pitcher did on the field.

The effect on careers is real. A player who reaches the 40-man roster young, gets shuttled through his three option years while establishing himself, and arrives at his prime with none left is in a precarious position for reasons that have nothing to do with how he pitches. He is a fixed cost on a roster designed for flexibility. Clubs part with such players every March, and the last week of spring training is reliably the busiest week of the year for exactly this reason: every club is running the same calculation at once, and the players who lose it all become available on the same Tuesday.

The connection back to the roster limits themselves, the thirteen pitchers and the forty names, is set out in how the roster rules fit together. Options are what make those limits survivable. Waivers are what happens when they are not.

Reading the transaction wire properly

Three habits turn the wire from noise into information.

Read a designation as a roster move, not a verdict. When a club designates a useful player, the question is not what he did wrong. It is what the club needed the spot for, and the answer is usually in the same day's transactions: a free agent signing, a waiver claim, a player coming off the sixty-day injured list. The designation is the second half of a transaction whose first half is the one being reported.

Check the options before believing a spring training story. Every March produces reports of a club deciding between two players for a final roster place. If one is out of options and the other is not, the decision was made in principle before camp opened, and everything since has been due process.

Watch who clears and who is claimed. A player claimed on waivers is a player another club thought was worth a 40-man place and the remaining salary. A player who clears is a player twenty-nine clubs looked at and passed on, which is a harder piece of information than any scouting report and is delivered for free.

The whole apparatus, options and waivers and designations and outrights, exists to answer one question a club faces daily: how do I move this person without losing him? Every rule above is a variation on that, and each one was written after somebody found a way of moving people that the previous version did not anticipate. Follow the transactions in baseball for a single winter and the rules stop being administrative trivia. They are the grammar the sport's roster decisions are written in, and they are checkable in a way almost nothing else about a front office is.