There is an interesting story occurring in Major League Baseball in regards to the Los Angeles Angels baseball team. The reason I find it fascinating is because it parallels quite nicely with a situation we had here in St. Louis with my beloved Cardinals. I think it is instructive from a human resources point of view.
Essentially the story is that the Angels have a player by the name of Mike Trout who had a spectacular rookie season and won the Rookie of the Year award. Because of the way baseball salaries are structured, players with less than a certain number of years of major league experience have very little power to bargain over their pay. After they reach a certain point these restrictions are removed and the players are free to seek a rate of pay their play deserves.
I’m not here to argue the benefits and drawbacks of such a system but merely to compare how the St. Louis Cardinals handled a very similar situation with Albert Pujols after his own astounding rookie campaign.
In the year 2000 the rookie minimum wage was $200,000 and Pujols was given this salary. He had an astounding season hitting .329 with 37 home runs, 130 RBI, a slugging percentage of .606 and an OPS of 1.013. You don’t really need to be a statistical guru to understand that he had a spectacular year. One of the most useful modern statistics is something called Wins Above Replacement which shows how many games the Cardinals won because Pujols was better than the average player at his position. His WAR in 2000 was 6.3
In the year 2012 the rookie minimum wage was $480,000 and Mike Trout was paid $490,000. He also had an astounding season hitting .326 with 30 home runs, 83 RBI, a slugging percentage of .567, OPS of .963, and a WAR of 10.7. Trout missed the first few weeks of the season before being called up so played about twenty fewer games than Pujols and is better than him in most defensive comparisons although they play different positions.
Major league teams are not obligated to give second year players any particular percent raise for their second season. The Angels agreed to give Trout a $20,000 pay raise so that he will make $510,00 this season. The Cardinals voluntarily gave Pujols a $400,000 raise to give him a second year salary of $600,000.
That’s what I find interesting. This was not just a one time thing. The Cardinals gave Adam Wainwright an $80,000 raise in his second year and a further $260,000 raise for his third when they were under no obligation to do so.
From a human resources perspective the question becomes what is it worth to make a valued employee happy. If you are under no legal obligation to give a larger raise then why would any company do so? I’d love to hear from HR people out there on the topic!
Personally, I’m of the opinion the Cardinals did the correct thing although Pujols eventually did leave to join the Angels. He played for eleven seasons in St. Louis when the reality is that after his sixth season he could have simply taken a much larger contract from a wealthier team like the Yankees. Instead he stayed in St. Louis and the Cardinals won the 2006 and 2011 World Series and made the playoffs almost every year.
Now, it’s entirely possible Trout will remain with the Angels for many years. They are a large market team with a great deal of money although much of that is tied up in the lucrative contract they gave Pujols to entice him away from St. Louis. The future is unpredictable. Still, I think that spending a smaller amount to make a key employee happy is almost always a good idea. Good employees, be they baseball players or computer software programmers, are not easy to find.
I think most people enjoy a good working environment where they are valued. Certainly for a talented individual there will be offers of more money and at some point they cannot be refused. But, a little proactive generosity can go a long way.
In any case, I’m glad the Cardinals were generous with Pujols in the early years because I got to see him play and lead us to two World Series victories. It’s impossible to say what would have happened if we hadn’t given him those early pay raises but I stand by my opinion that it was not only a nice thing to do, but the right thing to do. What do you think?
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A consensus building here (http://the-mike-trout-sign-o-meter.com/) is that Trout will sign with the Yankees for 10 years and $320MM+. The Angels will find a way to not sign him.
Thank you for the comment, James.
He’s still restricted until 2017 so that’s a ways off yet. It is interesting how the Cardinals tend to pay younger guys more than they are required and in return do get some loyalty. I’d think the Angels, with their large revenue, could afford the same strategy.