Update (4:30pm on 11/16/11): Sherman corrected himself today, and there will in fact be Type-B free agent compensation this offseason. It’s almost certainly going to be eliminated going forward, but the rules will not change this winter. The Yankees will still received a supplemental first round pick for Freddy Garcia if they offer him arbitration and he signs elsewhere.
Original (4:30pm on 11/15/11): Via Joel Sherman, baseball’s new Collective Bargaining Agreement is likely to eliminate Type-B free agent compensation this offseason according to a pair of executives familiar with the negotiations. Type-A compensation will be unchanged for top tier free agents (Jose Reyes, Prince Fielder, etc.), though some tinkering may be done to help the lower ranked players (Octavio Dotel, Kelly Johnson, etc.).
Freddy Garcia is a Type-B free agent, so the Yankees will lose out on a draft pick if the system is indeed changed and he signs elsewhere. On the bright side, they wouldn’t have to offer him arbitration to secure the potential pick, so there’s no worry about him possibly accepting and receiving a salary they club would be uncomfortable with next season. The new CBA has not yet been announced, but the clubs have been kept abreast of potential free agent compensation changes so they move forward with their offseason plans. The current deal expires on December 11th, but the new one should be wrapped up before the end of November.
Under the current system, clubs receive the signing team’s first round pick plus a supplemental first rounder in exchange for losing a Type-A. Type-B’s return just the supplemental first rounder. The up-to-date 2012 draft order can be found here.