What draft picks each team would receive for losing a qualified free agent

The qualifying offer is one of the key mechanisms of free agent season, as teams have until five days after the end of the World Series to decide whether or not to issue the one-year contract (this winter reportedly worth around $20.5M) to eligible free agents. If a player has played with his team throughout the entire 2023 season and hasn’t received a QO in the past, he is eligible to be issued a qualifying offer, and thus the player can opt to accept the QO and forego free agency altogether.

If the player rejects the QO, his former team is now in line to receive some draft-pick compensation if the free agent signs elsewhere. Here is the (mostly set) rundown of what every team will receive should one of their qualified free agents indeed head to another club…

Revenue sharing recipients: Diamondbacks, Rockies, Reds, Brewers, Pirates, Marlins, Athletics, Mariners, Tigers, Royals, Twins, Guardians, Orioles, Rays

If any of these teams has a QO-rejecting free agent who signs elsewhere for more than $50M in guaranteed money, the compensatory pick falls after the first round of the draft. If a team has a QO-rejecting free agent who signs elsewhere for less than $50M guaranteed, the compensatory pick would come between Competitive Balance Round B and the start of the third round. In the 2023 draft, these compensation picks were the 68th, 69th and 70th overall selections.

Of the pending free agents on these teams’ rosters, the Twins’ Sonny Gray is the most clear-cut candidate to receive a qualifying offer. Jorge Soler is expected to opt out of the final year of his contract with the Marlins, and Miami is likely to issue him a qualifying offer if Soler does indeed hit the open market again. The Mariners’ Teoscar Hernandez is also a good QO candidate, even though the outfielder is coming off a relative down year and might conceivably choose to just take the $20.5M payday in the hopes of a producing a better platform season in advance of the 2024-25 free agent class. On the other hand, since this offseason’s market is thin on position players, Hernandez and his representatives might feel this is the better time to reject a QO and pursue a lucrative multiyear deal.

Teams that don't receive revenue-sharing funds, and that didn't pay the competitive balance tax: Giants, Cardinals, Cubs, Nationals, Astros, White Sox, Red Sox

For these teams, the compensatory pick for losing a qualified free agent would also fall between CBR-B and the start of the third round (regardless of whether the player signed for more or less than $50M). Cody Bellinger is a lock to receive and reject the Cubs’ qualifying offer, as the outfielder/first baseman will be looking to cash in after his big bounce-back season in 2023. Aside from Bellinger, none of the other pending free agents for these teams look like plausible QO candidates.

The team in limbo: Angels

It should be noted that these lists of teams and their CBT status won’t be officially finalized until December. Usually, it isn’t difficult to figure out which teams surpass the $233M tax threshold, and sites like Roster Resource and Cot’s Baseball Contracts do excellent work in calculating luxury tax estimates over the course of a season. However, this winter w have a relatively rare case of a team whose status won’t be known until December, as the Angels are by all accounts right on the borderline of the $233M figure.

The Angels’ waiver wire purge in late August moved some salary off the books, but according to some reports at the start of September, the Halos remained slightly over the $233M mark. Cot’s has the Angels just over the line at an estimated $236M CBT number, while Roster Resource’s projection has the Angels avoiding a tax penalty with a $228.7M CBT number.

Given how the Angels have the offseason’s most prominent free agent in Shohei Ohtani, it is no small matter for the club to know exactly what draft compensation they might receive should Ohtani (after obviously rejecting the QO) depart for another team. While Ohtani re-signing in Anaheim is the best-case scenario, the next best option would be a compensatory pick in the 68-70 range for the Angels in next year’s draft…

Competitive balance tax payors: Dodgers, Padres, Mets, Phillies, Braves, Rangers, Blue Jays, Yankees

…and the least palatable option would be the lesser compensation should the Angels indeed end up over the CBT line. If a team exceeds the luxury tax, they still receive a pick if a qualified free agent signed elsewhere, but that compensatory pick falls after the fourth round of the 2024 draft. In the 2023 draft, these picks fell between 132nd and 137th overall.

Regardless of the Angels’ status, 2023 still set a new record for highest number of teams in excess of the luxury-tax threshold — the previous mark was six teams, in both 2022 and 2016. Of the 8-9 clubs surpassing the CBT this season, three (the Mets, Yankees and Padres) also surpassed the $273M threshold, which means that they’ll face the further penalty of having their first-round pick dropped back by 10 slots in the 2024 draft.

Several prominent free agents from the CBT payors are either locks or strong candidates to receive qualifying offers, including the Padres’ Blake Snell and Josh Hader, the Phillies’ Aaron Nola and the Blue Jays’ Matt Chapman. The Dodgers’ J.D. Martinez is a QO candidate on paper, but with Los Angeles heavily rumored to be making a run at Ohtani, the Dodgers might pass on issuing a QO to Martinez out of a concern that he might accept, thus tying up the team’s designated hitter spot.