Digging into Edwin Diaz' contract situation

There’s been so much made over the past year about how the Dodgers have gotten players to defer salary, making it so the value of the contract for Luxury Tax purposes is less than what it would otherwise be. It’s good business sense. But let’s not act like the Dodgers invented this particular maneuver. The Mets have done it, too, specifically when they signed Edwin Diaz following the 2022 season.

Here’s the information from Diaz’ contract, pulled from Cot’s:

5 years/$102M (2023-27), plus 2028 club option

• re-signed by NY Mets as a free agent 11/7/22

• $12M signing bonus

• 23:$17.25M, 24:$17.25M, 25:$17.5M, 26:$18.5M player option, 27:$18.5M player option, 28:$17.25M club option ($1M buyout)

• award bonuses: $100,000 each for WS MVP, Reliever of the Year. $50,000 each for All Star, Gold Glove, LCS MVP, Cy Young ($25,000 for second place in Cy Young vote, $10,000 for third in CY vote)

• Diaz must exercise or decline his 2026-27 player options simultaneously after the 2025 season

• no-trade protection: may block all trades through 10/30/25, may block deals to 10 clubs annually starting 11/1/25

• Diaz to defer $26.5M in salary ($5.5M each in 2023-25 and $5M each in 2026-27), reducing salary for tax purposes to about $18.6M

• deferred money to be paid each July 1 as follows:

  • $2.65M each in 2023, 2034. $200,000 in 2035.

  • $2.45M in 2035. $2.65M in 2036. $400,000 in 2037.

  • $2.25M in 2037. $2.65M in 2038. $600,000 in 2039.

  • $2.05M in 2023. $2.65M in 2040. $300,000 in 2041.

  • $2.35M in 2041. $2.65M in 2042

• at signing, largest-ever contract for a relief pitcher

• Mets to be reimbursed for 2023 salary of $18.64M (discounted to reflect deferral) under MLB insurance policy for players injured during the World Baseball Classic. The contract’s average annual value will count toward the club’s Competitive Balance Tax payroll.

I checked Cot’s this morning to confirm that Diaz’ deal went thru 2027. And it does, to a point. Diaz has opt outs for the final two seasons but he has to make his decisions on those after the 2025 campaign. And that deferred money isn’t chump change. Diaz deferred $26.5 million, or 25.9% of his entire deal. That deferral reduced his Luxury Tax number by $2 million each season over the life of the contract. The only reason it wasn’t more was because of the $12 million signing bonus he received.

There are two other additional notes here that jumped out to me. First, the Mets hold a club option for 2028 – should Diaz not opt out – for $17.25 million. And the other was the confirmation that the Mets were reimbursed for Diaz’ injury in the WBC but for MLB insurance, not insurance that the Mets took out on his deal.

So, if Diaz has a better year in 2025 than he did this past season – does he opt out of the final two years of his deal? Somehow the narrative developed that Diaz is the best reliever in the game, despite the fact that he’s been at that level for two seasons – 2018 and 2022 – since making his MLB debut in 2016. The Covid year might have been a third year at that elite level yet it’s hard to count a 25.2 IP stretch as a standout season.

And if you’re the Mets, do you want him to opt out? Is the erratic Diaz worth $37 million for the 2026-2027 seasons? FanGraphs had his elite 2022 season as being worth $24 million. But his less-than-special 2024 campaign as being worth $8.6 million. Conventional wisdom would have Diaz being better than he was last year but not quite as good as he was in 2022 in those two future seasons. But will they combine to be worth 4.5 fWAR, which is essentially what he should produce for $37 million?

Diaz will be in his age-32 and age-33 seasons in 2026 and 2027. That’s not old but we witnessed significant declines from recent – and still active – elite closers in that time period. Aroldis Chapman had a career-high 3.2 fWAR and three other seasons with at least a 2.5 mark in his 20s. But for his age-32 and age-33 seasons, he had a combined 0.9 fWAR. Kenley Jansen had 3.4 and 3.1 fWAR campaigns in his 20s. But for the age-32-33 seasons, he had a combined 2.4 fWAR. Craig Kimbrel posted 2.8 and 3.1 and 3.2 fWAR seasons in his 20s. But those age-32-33 campaigns saw a combined 2.1 mark.

In 2022, Diaz had a 3.0 fWAR.

It’s great to have a shutdown closer to wrap up those ninth-inning leads. Last year, Diaz didn’t pitch a full season, as he spent time on the IL, as well as serving a 10-game suspension for allegedly violating the nebulous-sticky-stuff rules. But he pitched enough to have 20 saves. But that’s only a partial statistic. Diaz also had seven blown saves. Is a 74.1 save percentage good? Clay Holmes had a 69.8% and lost his job. Kimbrel had a 79.3% and he lost his job, too. Robert Suarez had an 85.7% and kept his job all year.

My hope is that Diaz puts in a 2025 campaign in which he comes close to the numbers he posted in 2022. Then after the season is over, he opts out of the final two years. With David Stearns at the helm, it seems unlikely that the Mets would shop at the very top of the reliever market, so my guess is that he would let Diaz go to another club to get overpaid. It was a bad deal when the Mets signed Diaz out of free agency following the 2022 season. Yet the Mets may end up getting out of it two years early. That would be worthy of trumpets.