The Los Angeles Dodgers came to an agreement on a three-year, $69 million contract with free agent closer Edwin Díaz to provide a major boost to their bullpen.
The $23 million average annual value (AAV) of the contract set a new record for relievers, surpassing the $20.4 million mark Díaz received in his last deal with the New York Mets. It is the second major contract the Dodgers have handed out to a relief pitcher in as many years, following the signing of Tanner Scott last offseason.
Scott signed a four-year contract with an AAV of $18 million, and $72 million in total. However, his contract included $21 million in deferred money, which brought Scott’s cap hit to around $12 million from 2025-2026 and roughly $16 million in the final two years.
According to Joel Sherman of the New York Post, Díaz’s new contract with the Dodgers reportedly also includes deferred payments, though not to the same extent:
Source: deferrals on Diaz deal with the Dodgers is $4.5M annually for the 3 years. For luxury tax purposes will calculate at roughly $21.1M
— Joel Sherman (@Joelsherman1) December 9, 2025
Even though the deferrals technically lowers the AAV of the right-hander’s contract, it is still a record-setting total. Between Díaz and Scott, the Dodgers have two of the highest-paid relievers by AAV in MLB history.
The Dodgers are projected to be over the 2026 competitive balance threshold (CBT) of $244 million after the signing of Díaz. That’s despite shedding $87 million in payroll heading into the offseason and the minor deferrals in Díaz’s contract as well.
That is of little consequence to the Dodgers, who have long been willing to absorb the extra penalties in the interest of constructing the best possible roster.
Dodgers continue use of deferrals despite concerns from MLB
Last December, MLB commissioner Rob Manfred expressed his reservations with the growing rise of deferred salaries. MLB has regulated the use of delaying payments to players by requiring the deferred salary to be placed in escrow, which ensures the player who signed the contract will receive his money.
The Dodgers are not the only team to utilize this payment option this offseason, as the Toronto Blue Jays deferred $64 million of the seven-year, $210 million contract they signed Dylan Cease to.
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