The August Waiver Trading Period

The July 31 trading deadline came and went last week, with quite a bang. Numerous deadline deals were consummated, with players of varying pedigree changing uniforms. David Price and Jon Lester were the big names, but perhaps the most notable aspect of the proceedings was the movement of incumbent major league regulars by contending clubs, such as Yoenis Cespedes and Austin Jackson, in lieu of or in addition to minor league prospects in pursuit of the biggest fish available.

“Deadline” is a somewhat misleading term, however, as trades will continue to be made throughout the month of August. A whole new bunch of arcane industry rules apply, however, in the August waiver trading period, creating a cat-and-mouse game where teams must not only know which players they covet and are willing to give up, but also which players their competition wants, prompting aggressive moves to block their rivals.

At some point in time during the month of August, virtually every player on all 30 clubs’ 40-man rosters will be placed on trade waivers. The only exceptions may be the foremost superstars in the game, such as Mike Trout, Clayton Kershaw, Felix Hernandez, etc.. Some of them may even see their day on the trade waiver wire, even though their clubs have absolutely no intention of trading them. Trade waivers are revocable, after all. Most clubs have absolutely no intention of trading most of the players on their 40-man roster, but successfully clearing a player through trade waivers gives the club the option of moving a player should that pie-in-the-sky, dream trade offer come through the transom in August. From the perspective of the club placing a player through waivers, it’s all about creating options.

Clubs will place their players, a few at a time, on trade waivers throughout the month. The timing often depends upon the player, and upon the club’s place in the standings at any moment in time. There is usually a crush of players placed on trade waivers early in the month. Coming on the heels of the trading deadline, sellers may often try to sneak their foremost trade properties through waivers in early August, while the “fog of war” mentality that prevails on July 31 is still in place. The middle of the month sees a relative trickle of players being passed through trade waivers, and then it picks back up again at the end of August. A club that is still trying to determine whether to buy or sell may hold off on putting its premier trade assets through waivers until late in the month, when they have a better idea of their fate.

Each day, each club is informed of all players placed on trade waivers by all clubs on that date. Each player remains on trade waivers for two days, and a specific time deadline is noted informing each club of the expiration of those waivers. If no team claims a player, he is free to be traded to any of the other 29 clubs for the rest of the season. If a single team claims a player, that team is the only one that may trade for him. If multiple teams claim a player, the claiming team with the worst record in that player’s league is awarded the claim. If no club in his own league claims a player, the claim is then awarded to the claiming team with the worst record in the other league. For this reason, it is much more likely that the most desired, but ultimately untraded July 31 trade properties will remain within their own league if traded in August.

Once a waiver claim is awarded, the two clubs then have another two days to discuss a trade involving the claimed player. He cannot be traded for 40-man roster player(s) that have not yet cleared trade waivers themselves, though such players can be designated as “players to be named later”. Claimed players may also be traded for any minor league player(s) not currently on the 40-man roster.

It should be emphasized that when a club is claiming a player who is on trade waivers, it is claiming his contract as well. Matt Kemp will be placed on trade waivers at some point in August. Any potential claimer does so at its own risk, as the Dodgers could choose to simply step aside and allow Kemp’s massive contract to go elsewhere for no compensation. This is how the White Sox got Alex Rios from the Blue Jays a few years back. The Chisox assumed the contract, and the risk, and were vindicated at least to some extent as Rios got his career back on track afterward.

Quite often, clubs will have extensive, somewhat fruitful discussions about a player with a particular club in July, only for the deadline to pass without consummation of a deal. A team may wish to direct that player towards that specific team, especially if the target team is in the same league, but the standings on any given day may impact the timing of the placement of that player on waivers.

Let’s say, hypothetically, that the Twins and Royals had productive discussions about Josh Willingham prior to the July deadline. The Royals are in a four or five-team scrum in the middle of the AL wildcard race, with their waiver order spot fluctuating daily. The Twins could wait for the Royals to hit a dead spot of sorts, and fall beneath potential blocking teams such as the Mariners or Indians, and then put Willingham on waivers. Of course, the Royals could win the next two games while Willingham is on waivers, and rise in the pecking order, or continue their slide, and decide that Willingham isn’t worth the claim. This is just an example of the calculus each team goes through on a daily basis throughout August, except multiplied many times over, as large numbers of players work their way through the process.

Strategy-wise, teams differ very little with regard to placement of their own players on trade waivers. The timing of placement is basically the only variable. Clubs employ a variety of approaches with regard to making claims on other clubs’ players. There will be a significant group of clubs in any given season who will place few, if any claims. These clubs include sellers who are more focused on bolstering their minor league systems, or young, developing clubs who are happy with their current direction. There are also low-activity clubs who just don’t place claims, for whatever reason.

On the other pole, there are clubs who claim anyone and everyone in whom they are interested. Such clubs may be making claims and earnestly looking to make good, old-fashioned baseball trades, or they may be making claims just to make claims, and not having meaningful trade discussions regarding the claimed player. The latter case gets real old for buyers sitting behind such clubs in the pecking order who continuously get snookered out by relatively meaningless claims.

The most interesting clubs are the ones who claim aggressively but intelligently, either to go get a player they want, or just as importantly, block their competition from getting a player they want. Extremely taut pennant races in both leagues offer many front offices the opportunity to battle in the trade waiver trenches all month long while their clubs are duking it out on the field. In the AL, the Blue Jays, Yankees, Royals, Mariners, Indians and possibly another team or two are swapping claiming order spots on a daily basis. It’s even crazier in the NL, where there are no A’s or Angels running away from the pack. The top seven clubs – the Dodgers, Brewers, Nationals, Cards, Giants, Pirates and Braves – are swapping spots daily. Each of these clubs has multiple front office members monitoring the needs of their competition, often recommending “defensive” claims directly targeted at their competition.

August 31 then becomes the next important deadline – for an acquired player to appear in postseason play, a trade must be consummated by then. As we work our way into the second half of August, teams will need to whittle down their potential targets, and their potential trade bait, so they know where to direct their energies between then and August 31. Each and every day, the passage of players through trade waivers affects each club’s range of opportunities. Each team must have a detailed system in place to track the execution of all of these behind the scenes actions.

In 2012, I guarantee you that the Red Sox and Dodgers had absolutely no idea at the beginning of August that they would, within weeks, consummate a franchise-altering deal for both clubs. Adrian Gonzalez, Josh Beckett, Carl Crawford, and all of the money attached to them, would go to the Dodgers, while massive salary relief and some attractive prospects would head to the Red Sox. The Sox used such relief to rebuild their club into a World Series champion, while the Dodgers at least have gotten some mileage out of Gonzalez and Beckett, and remain a core NL contender. Both clubs utilized the August waiver process to keep their options open, and then drop a bombshell.

There is one other way that trade waivers can sneak up and bite you. As stated earlier, trade waivers are revocable – once. You had better track the dates on which you placed all our 40-man roster guys on trade waivers, because if you mistakenly do so a second time – they’re gone. This actually happened to the Pirates in 1990, when they placed outfielders Wes Chamberlain and Julio Peguero on trade waivers a second time. The Phillies noticed, and worked out a deal in which they acquired those two plus a third outfielder, Tony Longmire, in exchange for a cooked Carmelo Martinez. Chamberlain turned into a somewhat productive big leaguer, a platooner on the 1993 NL champs, and the Phillies got him only because of an administrative screwup.

There will be a few trades made this month, potentially even a large one or two, though history tells it probably won’t evoke the Red Sox-Dodgers mega-deal. For every one that is made, however, there will be countless ones blocked or made impossible by the chess players in the 30 MLB front offices. The standings aren’t based on how many games you win – they’re based on how many you win, relative to your opponents. Sometimes it’s just as important to impair your competition, within the rules, as it is to help yourself.