Yankees’ J.A. Happ negotiation puts both sides in tricky spot

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The Yankees and J.A. Happ will try to work out details of how to handle his 2021 vesting option, a negotiation that possibly will impact how he is used this year and if he is still with the club next year.

MLB and the players association reached an agreement Monday that covers how a variety of contracts issues will be handled in this abbreviated season, including rules on vesting options.

The deal stated that players with vesting options would receive the contractual option total in full, but the thresholds that trigger the option would be prorated based on games played this year.

Happ has a $17 million option for 2021 that in a standard 162-game season would have vested if he reached 26 starts or 165 innings. Prorated for a 60-game season, Happ would have to reach 10 starts or 61 ¹/₃ innings to trigger the $17 million option.

But the March agreement between the sides committed MLB and the union to negotiate in good faith on special covenants such as vesting options, including covenants based on injured days and for players who were injured as of late March.

J.A. Happ
J.A. HappRobert Sabo

Happ was put in a category covered by that injury addendum by MLB/Yankees. Therefore, the league argues he does not fall under the umbrella and that he and the Yankees have to negotiate new thresholds for starts or innings and/or a new 2021 option total; or else the matter is sent to an arbitrator to decide.

If it goes to an arbitrator both MLB and the union reserved the right to argue whatever they want, including the players association reserving the right to argue that Happ does not belong on a separate list because he was not injured. Happ has not been on an injured list since signing his two-year, $34 million contract with the Yankees that contains the 2021 vesting option. And Aaron Boone said Tuesday that Happ was a healthy player in the first spring training this year in March.

There is no set time yet for when the case would go to an arbitrator, but the Yankees certainly would like to know what Happ’s thresholds are before the season begins since they would not want to pay him $17 million next year. Teams are not allowed to purposely manipulate usage to avoid triggering options. But the Yanks could arguably, say, deploy openers with some legitimacy to make sure that Happ reached neither 10 starts nor 61 ¹/₃ innings.

However, that would begin to impact strategy in a year in which each game will have even greater value. That could push the Yanks to want to work out a deal with Happ as a way to avoid such uncomfortable decisions.

Conversely, Happ also might be compelled to reach a deal. Free agency is expected to be unkind this offseason to even prime-aged stars with teams incurring revenue hits in 2020 and uncertainty about revenue for 2021 amid the COVID-19 pandemic. Happ turns 38 in October. He is a good starter, but not great.

So could it behoove him to drop his option total to the $6 million-$10 million range or even just sign a contract with the Yankees in that area for next year as a way to guarantee dollars in 2021 amid the uncertainty and to guarantee no distractions this season?

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