Draft Week: MLB Draft Rules and Procedures

As you've been reading all week, the MLB draft is nearly upon us.  The first round starts on Monday, June 7 at 6 PM CDT.  The draft continues via conference call at 11 AM CDT on June 8 and June 9.  With that in mind, there is no time like the present to review the draft rules and procedures.

The most important part of the draft is not the teams involved or the order in which they pick.  It is the players who are selected.  Only residents of the United States and Canada who have not yet signed a major or minor league contract are eligible to be selected in the draft.  Players from Puerto Rico and other U.S. territories are considered U.S. residents, as are players enrolled in high school or college in the U.S., regardless of their national origin.  Among the pool of players who meet the above conditions, there are three groups eligible to be drafted:

  1. High school graduates who have not yet attended college or junior college.
  2. College players who are at least 21 years old or who have completed their junior or senior year.
  3. Any junior college player.

Now that we know who can be selected, it is important to determine the order in which teams pick their new prospects.  The regular draft order is probably the simplest rule in baseball: teams select in reverse order of their winning percentage from the year before.  If two teams finish the same winning percentage, their winning percentage from the previous year is used.  An example: the Mets and Diamondbacks finished with the same 2009 record.  The Diamondbacks had a lower winning percentage in 2008, so they pick in front of the Mets next week.

Once the draft order is set, it remains the same for each round of the draft.  The draft can go for up to 50 rounds.  A team can choose to "pass" in any given round.  If a team chooses to do so, the team forfeits the right to pick a player in all remaining rounds.  The draft used to go on as long as at least one team chose to keep picking players.  This explains how Brewers reliever David Riske was selected in the 56th round and All-Star catcher Mike Piazza was a 62nd round pick.  The longest the draft ever went was 100 rounds in 1996.  The Yankees selected third basemen Aron Amundson out of Eastern Oklahoma State Community College; he didn't sign.  The Devil Rays picked Travis Phelps in the 89th round of that draft; he made his major league debut for the team in 2001.

The regular draft order is simple.  Major League Baseball compensates by making complex rules that change the draft order.  In between the first and second round sits a "compensation" round.  As the name suggests, this round exists because of the free agent compensation system.  As you are likely aware, free agents are statistically ranked after each season and divided into three groups: Type A free agents, Type B free agents, and "regular" free agents.  A team signing a Type A free agent gives up their top draft pick, unless they have one of the first fifteen selections.  In that case, they give up their highest remaining pick.  A team signing a Type B free agent does not give up any picks.  Rather, the team that loses the free agent is compensated with a pick in the compensation round (also known as a "sandwich pick").  Compensation round picks are ordered the same way regular rounds are, by inverse order of winning percentage.

If you've managed to understand all that, you may be dismayed to know there is another way the draft order can be changed.  Teams that fail to sign their first and/or second round picks are rewarded with a nearly identical pick in the next draft.  As an example, for failing to sign 14th overall pick Matt Purke last year, the Rangers were rewarded with the 15th overall pick this year.  Teams that fail to sign their third-round pick are rewarded with a pick in between rounds three and four of the draft.  Last year, the Astros were the only team with such a pick.

Now that all the ways the draft order can be changed have been covered, it is time to look what teams cannot do with their picks.  First, teams cannot trade draft picks before or during the draft.  Second, teams cannot trade draft picks for a year after they are signed.

Speaking of signings, there are rules covering that aspect of the draft as well.  The first step involves providing written notice to selected players.  Teams must do this within fifteen days of the draft or risk losing exclusive negotiating rights.  Teams then have until August 15 (except for college seniors) to sign their players.  Teams have until one week before the next year's draft to sign college seniors.  If a player does not sign with the club that drafted him, he can be selected in the next draft (provided he still meets all eligibility conditions).  He cannot be drafted by the same team without his permission.

Like nearly all Major League Baseball inventions, the draft has complex rules that are difficult to understand.  Fortunately, like nearly all Major League Baseball inventions, it is not necessary to understand all the ins and outs of the draft to enjoy the process and the promise it brings.

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