Dodgers $401M Payroll Adds Tension Ahead of MLB Labor Talks

Major League Baseball already had a thorny economic problem heading into this year’s labor negotiations with the MLB Players Association. The ongoing dominance of the two-time defending World Series champion Dodgers complicates that further.

League commissioner Rob Manfred highlighted the two sides of the issue as owners meetings concluded Thursday in Palm Beach, Fla. On one hand, the Dodgers are fully compliant with the current collective bargaining agreement, and their performance has driven widespread fan interest around the globe, thanks in no small part to a star-studded roster led in part by Japanese phenom Shohei Ohtani.

On the other hand, the club’s luxury-tax payroll this season is $401.1 million, and the recent free-agent acquisition of outfielder Kyle Tucker exacerbates an already-growing fiscal divide within the sport, and fan unrest because of that. The Dodgers’ 2026 outlay more than quadruples the comparable figure for the Marlins.

“I think great teams are always good for baseball,” Manfred said Thursday afternoon. “I think, with respect to this particular great team, it added to what we have been hearing from fans in a lot of markets for a long time about the competitiveness of the game. But great teams are always good for baseball.”

The issue will be a central one in what is expected to be a fractious round of labor talks between the league and the union as a management lockout is widely expected. Manfred, however, said there remains no formal start time for those negotiations. The current, five-year pact expires Dec. 1.

“The only projection I can make, because we haven’t agreed on a calendar with the MLBPA, and it does take two to tango, as they say, is that historically after Opening Day, we kind of get started,” Manfred said.

Watching RSNs

The accelerating decline of the regional sports network business, and the resulting revenue impacts, will also be a fundamental factor in those labor talks. All nine of the MLB clubs that had been tied to FanDuel Sports Network parent company Main Street Sports Group have left that operation, with eight of them aligning with MLB’s in-house model for local game production and distribution. The Braves, meanwhile, are instead expected to form their own local media network, similar to what the Rangers have done.

That disruption, however, is creating significant short-term revenue hits for many of the impacted clubs, in some cases reaching into eight figures.

“I think our RSN situation has an impact on our revenue growth because the decline there is, you know, a drag on what is otherwise a growing industry,” Manfred said, alluding to increases in other key metrics such as attendance and national viewership. “It is true that the smaller markets have been hit harder than the larger markets, which impacts revenue-sharing. 

“Having said both of those, I think, longer term, our content is inherently valuable. We deliver tons of eyeballs, and think when we have an opportunity to get to market in 2028, we’re going to be just fine,” he said.

At that point, MLB’s other national media-rights contracts will expire, and Manfred intends then to blend national and local rights in a much more substantial way when negotiating with networks.

Padres Sale

Manfred, meanwhile, expects to see significant activity around the ongoing sale of the Padres, with multiple potential buyers. The Seidler family recently put the franchise up for sale, shortly before settling a legal dispute with Sheel Seidler, the widow of former Padres chairman Peter Seidler. 

The franchise is something of a study in contrasts, as it posted the second-best attendance in the league in 2025, behind only the Dodgers, and has a gem of a home ballpark in Petco Park. The club, however, has incurred significant debt and was the first cut in the bankruptcy of the former Diamond Sports Group (now Main Street Sports), and the Padres’ local rights are part of MLB’s in-house media model.

“The best I can tell you on the Padres is there is robust interest on what is viewed as a really appealing asset,” Manfred said.

More Changes

MLB owners, meanwhile, approved Thursday a rule change mandating that base coaches remain in their designated boxes at all times.

The change comes after coaches have increasingly migrated up and down the baseline, looking to discern patterns from opposing pitchers and communicate their findings to batters and baserunners.

Olympic Distance

The league is still attempting to work out the logistics that would allow MLB players to participate in the 2028 Summer Olympics in Los Angeles. MLB, however, is not currently negotiating with Casey Wasserman, the embattled chair of the LA28 organizing committee, who has appeared in the Epstein files.

“Our dealings are not with Casey,” Manfred said. “Our dealings are with the institution of the Olympics.”