Chavez was awarded a $4 million salary on Saturday by arbitrators Mark Irvings, Steven Wolf and Edna Francis, who heard the case a day earlier. The Blue Jays argued the 32-year-old right-hander should be paid $3.6 million.
Tampa Bay pitcher Drew Smyly ($3.75 million) and Cincinnati reliever J.J. Hoover ($1.4 million) won the first two decisions earlier this week.
Chavez was 7-15 with a 4.18 ERA and one save in a career-high 26 starts and four relief appearances last season for Oakland, which traded him to Toronto on Nov. 20 for right-hander Liam Hendriks. He received two runs of support or fewer in 17 starts.
Chavez started the season in the bullpen and moved into the rotation April 23. He season ended when the Athletics put him on the disabled list Sept. 15 because of a broken rib.
Over eight big league seasons, Chavez is 24-38 with a 4.55 ERA with Pittsburgh (2008-09), Atlanta (2010), Kansas City (2010-11), Toronto (2012) and Oakland (2013-15).
He earned $2.15 million last season and can become a free agent after this year's World Series.
Toronto has one player remaining in arbitration: AL MVP Josh Donaldson. He has asked for a raise from $4.3 million to $11.8 million and has been offered $11.3 million.