Phelps was awarded $1.4 million Friday rather than his request of $1,875,000. The panel of by Mark Burstein, Dennis Archer and Sylvia Skratek heard arguments a day earlier.
Phelps was 5-5 with a 3.82 ERA in 17 starts and 15 relief appearances for the New York Yankees last year, when he made $541,425. The A 28-year-old right-hander was traded to Miami in December along with versatile Martin Prado for right-hander Nathan Eovaldi, outfielder Garrett Jones and a minor leaguer.
Teams have won five of eight decisions this year. Toronto also defeated third baseman Josh Donaldson on Friday.