BA Fantasy: Play Our Daily Fantasy Simulation!

Explaining The Rule 5 Draft

What is the Rule 5 Draft?

The simplest way to explain the Rule 5 draft is it's a way for teams to snap up the excess from other team's rosters, providing buried players with a clearer path to the big leagues. It originated back when baseball was "organized" in 1903. At the time, every team (majors or minors) was its own entity. There was a worry that players would be limited from moving up to higher leagues because minor league teams would hoard their best players.

So the draft (the amateur draft was still more than 60 years away, so it was simply known as the draft) was developed to give a way for teams to pluck players from lower-level teams.

See our 2018 Rule 5 Draft Preview

The rules for eligibility have been tweaked many times over the years, but at its core the Rule 5 draft still tries to do the same thing. If one team is unwilling to put a player on their 40-man roster and another team is willing to carry that player on its 25-man active roster all season, then the player should be given the opportunity.

When is the 2018 Rule 5 Draft?

Thursday, Dec. 13th at 12 p.m. ET/9 a.m. PT at the Winter Meetings. 

OK, that sounds pretty simple. Is that it?

That's the simple answer, and for even many baseball fans that's enough. But if you want a more detailed answer, here it is.

Anyone on a team's 40-man major league roster is protected from the entirety of the Rule 5 draft and can't be picked.

See the best players selected over the history of the Rule 5 Draft

Also any players who have not been professionals long enough are also ineligible for the Rule 5 draft. For any pro who signed his initial contract as an 18-year-old or younger is eligible for the Rule 5 draft after their fifth professional season. Anyone who initially signed at 19 or older is eligible after their fourth professional season.

The wording of that is precise for a reason. If a player's first contract is signed where they are assigned to a team whose season has already ended, than that player's first counting season does not begin until the next season. The demise of the Venezuelan League, which ended in early August, has meant that there are less of these loophole players, but as an example Ronaldo Hernandez, one of the Rays top prospects, did not have to be protected from the Rule 5 draft because he signed in early August 2014 after the Rays VSL team's season ended.

Once a Rule 5 player has been picked, the team picking the player pays a $100,000 draft fee to the player's original team. That player is then added to the new team's 40-man roster (they have to have an open roster spot to be eligible to pick a player).

And then that player must be kept on the active 25-man major league roster for the entire upcoming season. They can be placed on the disabled list if they have a legitimate injury (there have been grievances filed and won over phantom Rule 5 injuries), but they can't be optioned to the minors. Instead, if a team decides to clear the Rule 5 pick from their active roster, they have to be placed on waivers. Any other team can claim the player and by doing so assume the Rule 5 roster responsibilities. If no one claims the player, he is dropped from the 40-man roster. He  is offered back to his original team who can chose to take him back (and payback $50,000 of the $100,000 selection fee) and send him to the minors or keep the money and let the player go to his new team. In that case, the player can be sent to the minors by his new team.

Rule 5 picks can be traded and many of them are during the Rule 5 draft (usually for cash). And those trades don't become public until after the draft, so just because a player picks a player in the Rule 5 draft doesn't mean they'll keep them. Theoretically a team could trade a Rule 5 pick during the season, but that almost never happens. For one, it would be hard to properly value a player who carries such roster restrictions.

Also, anyone who is on the 38-player Triple-A roster is protected from being picked in the minor league draft.

The minor league phase is much simpler--there are no eligibility rules that have to then be maintained. The player is drafted, the player's old organization is paid $24,500 (editor's note: this is updated after originally stating an incorrect figure) and immediately the player becomes a member of his new organization. Almost all of the players picked in the minor league phase of the Rule 5 draft are viewed as useful organizational players for their new team, but occasionally a player does find success with his new organization. Top players picked in the minor league Rule 5 include Alexi Ogando, Justin Bour, Omar Narvaez and Alejandro de Aza.

Also, Seahawks quarterback Russell Wilson, a former minor league second baseman for the Rockies, gets picked a lot in the minor league Rule 5 draft. He's then invited to spring training, speaks to the team and wears the uniform. He got an at-bat for the Yankees last season in spring training. It's becoming a Rule 5 tradition and he's eligible again this year.

Frank Thomas Focusonsport

Identifying The Best MLB Draft Picks To Hit For Average And Power

Just how hard is it to draft and develop a 70-grade hitter with 70-grade power? History suggests it's as difficult as you'd expect.

Are you a member?

In order to access this exclusive content you must have a Baseball America Account. 

Login or sign up  

of Free Stories Remaining