Major League Baseball transactions are changes made to the roster of a major league team during or after the season. They may include waiving, releasing, and trading players, as well assigning players to minor league teams.

25/40 man rosterEdit

Each Major League Baseball team maintains both a 25-man roster and a 40-man roster of players, year-round. The 25-man roster is the list of eligible players who may play in a game. The 40-man roster includes the 25-man roster plus players in the minor leagues as well as players on the 15-day disabled list (see below). From September 1 through the end of the regular season, active rosters are expanded to a limit of 40 players; thus, clubs may freely add any of these 15 players to its active roster, giving them the opportunity to play in the major leagues near the end of the season.


Teams may trade only players currently under contract, except those players who have been drafted in the last year. From the end of the previous World Series through July, trades between two or more major league teams may freely occur at any time. In August, trades may only be made after all players in the trade clear waivers or are not on 40-man rosters. Players acquired after August 31 are ineligible for the postseason roster, unless they replace an injured player. Unlike in the NFL, NHL and the NBA, teams may not trade draft choices.

If a player has been on an active major league roster for ten full seasons and on one team for the last five, he may not be traded to another team without his consent (known as the 10/5 rule). Additionally, some players negotiate to have no-trade clauses in their contracts that have the same effect.

In some trades, one of the components is a "player to be named later" which usually turns out to be a minor league player. This to-be-determined player is included as part of a trade when two or more general managers making the trade can't immediately agree on which player they want or which player they're willing to lose, or when a player is not eligible to be traded until a later point in time. Trades must be completed within the six months. Sometimes, cash or other considerations take the place of the player to be named later; for example, in 1994, the Minnesota Twins traded Dave Winfield[1] to the Cleveland Indians at the trade deadline during the strike for a player to be named later. The trade was later settled when the Twins' and Indians' staff together enjoyed a meal, with the Indians organization picking up the tab.


Any player under contract may be placed on waivers at any time. If a player is waived, any team may claim him. If more than one team claims a player from waivers, the team with the lowest record in the player's league gets preference. If no team in the player's league claims him, the claiming team with the lowest record in the other league gets preference. The previous year's standings are used during the first month of a season to determine preference.

If a team claims a player off waivers and has the viable claim as described above, his first team may choose one of the following:

  • arrange a trade with the new team for that player within two business days of the claim; or
  • rescind the request and keep the player on their major league roster, effectively canceling the waiver; or
  • do nothing and allow the claiming team to assume the player's existing contract, pay a waiver fee to the first team, and place him on their active major league roster

If a player is claimed and the option to rescind is used, this option to rescind a waiver may not be used again for that player in that season. If no team claims a player from waivers in three business days, the player has cleared waivers and may be assigned to a minor league team, traded, or released outright.

The waiver "wire" is a secret within the personnel of the Major League Baseball clubs; no announcement of a waiver is made until a transaction actually occurs. Many players are often quietly waived during the August "waiver-required" trading period to gauge trade interest in a particular player. Usually, when the player is claimed, the waiving team will rescind the waiver to avoid losing the player unless a trade can be worked out with the claiming team.

Assignment to a minor league teamEdit


If a player is on the 40-man roster but not on the active major league roster, he is said to be on optional assignment—his organization may freely move him between the major league club and the minor league club. If a player is on the 40-man roster and not the active 25 man roster for any part of more than three seasons, he is out of options and may not be assigned to the minors without first clearing waivers. If a major league player is ineligible for free agency and "has options" remaining, his team may option him to a minor league team without consequence. This is usually what is meant when players are "sent down" to the minors. Likewise, when a player on the 40-man roster is added to the active major league roster, he is "called up" to the majors.

Designated for assignmentEdit

Main article: Designated for assignment

A player who is designated for assignment is immediately removed from the 40-man roster. This gives the team time to decide what to do with the player while freeing up a roster spot for another transaction, if needed. Once a player is designated for assignment, the team has ten days to do one of the following things: the player can be traded, the player can be released, or the player can be put on waivers and, provided they clear, outrighted to the minors. A player who is outrighted to the minors is removed from the 40-man roster but is still paid according to the terms of his guaranteed contract. A player can only be outrighted once in his career without his consent.

Veterans' consentEdit

If a player has 5 years of major-league service, he may not be assigned to a minor-league team without his consent, regardless of whether he has already been outrighted once, even if he clears waivers. If the player withholds consent, the team must either release him or keep him on the major league roster. In either case, the player must continue to be paid under the terms of his contract. If he is released and signs with a new team, his previous team must pay the difference in salary between the two contracts if the previous contract called for a greater salary.

Disabled listEdit

If a major league player cannot play because of a medical condition, he may be placed on the 15-day disabled list. The team then frees up a spot on their active major league roster, and the player may not play for at least 15 consecutive days. An injured player may also be placed on the 60-day disabled list. The team then frees up a spot on both the active major-league roster and the 40-man roster; the player may not play for at least 60 consecutive days.

Players placed on the 15-day disabled list may be moved to the 60-day list at any time, but not vice versa. Players may be placed on either disabled list retroactively for a minimum of 10 inactive days and may remain on either list for as long as required to recover. Injured players may not be traded without permission of the Commissioner nor may they be optioned to the minors, though they may be assigned to a minor league club for rehabilitation for a limited amount of time (30 days for pitchers, 20 for non-pitchers).

Rule 5 draftEdit

Main article: Rule 5 draft

If a player not on a 40-man roster has spent three years with a minor-league contract originally signed when 19 or older or 4 years when signed before the age of 19, he is eligible to be chosen by any team in the rule 5 draft during the offseason. No team is required to choose a player in the draft, but many do. If chosen, the player must be kept on the selecting team's 25-man major league roster for the entire season after the draft—he may not be optioned or designated to the minors. The selecting team may, at any time, waive the rule 5 draftee, such as when they no longer wish to keep them on their major league roster. If a rule 5 draftee clears waivers, he must be offered back to the original team, effectively canceling the rule 5 draft choice. Once a rule 5 draftee spends an entire season on his new team's 25-man roster, his status reverts to normal and he may be optioned or designated for assignment. To prevent the abuse of the rule 5 draft, the rule also states that the draftee must be active for at least 90 days. This keeps teams from drafting players, then "hiding" them on the disabled list for the majority of the season. For example, if a rule 5 draftee was only active for 67 days in his first season with his new club, he must be active for an additional 23 games in his second season to satisfy the rule 5 requirements.

Any player chosen in the rule 5 draft may be traded to any team while under the rule 5 restrictions, but the restrictions transfer to the new team—if the new team does not want to keep the player on their 25-man roster for the season, he must be offered back to the team he was on when he was chosen in the draft.

The intent of the rule 5 draft is to prevent teams from holding major league-potential players in the minor leagues when other teams would be willing to have them play in the majors. However, this draft has also become an opportunity for a team to take a top prospect from another team who might not be ready for the major leagues. For example, Cy Young award winner Johan Santana was chosen by the Minnesota Twins four years before winning the award, when the Houston Astros declined to put him on their 40-man roster. The Twins chose Santana in the 1999 rule 5 draft, and kept him on their roster for the 2000 season, in which he toiled to a 6.49 earned run average at only 21 years of age. Two years later, he legitimized himself as a Major League pitcher, with an ERA under 3.00, and two years after that, he was recognized as the best pitcher in the league. Had he not been chosen in the rule 5 draft, he likely would not have made his major-league debut until the 2001 or the 2002 season with the Astros.

Free agency and salary arbitrationEdit

If a player is drafted and is offered a contract by his drafting team (or any team he is traded to) each year, he may not become a free agent until he has been on a major league roster or disabled list for at least six years. Otherwise, any player without a contract may become a free agent and sign with any team.

A player is eligible for salary arbitration if he:

  1. is ineligible for free agency
  2. is without a contract
  3. cannot agree with his current team on a new contract
  4. has been on a major league roster or disabled list for at least three years

In this process, the player and the team both submit a salary offer for a new contract; the arbitrator chooses one number or the other, whichever is thought to be most "fair" given comparable wages among players with similar ability and service time. Players thus rely on arbitration and free agency to increase their salaries.

Players eligible for neither free agency nor salary arbitration are very seldom offered contracts for much more than the league minimum salary, as the player has no recourse to try to obtain a better salary elsewhere. For this reason, in the first three major league years of their careers, players accept comparatively low salaries even when their performance is stellar. This is an accepted practice; talented, young players are usually content to "pay their dues" in this way and earn a chance to negotiate for more in their fourth year. Occasionally, a team may wish to sign a player in their second or third year to a long-term contract, for which negotiation can take place for a much higher salary.


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