Yes, they could hold him out. If he didn't have any service time you're looking at a few weeks, which would be no big deal. However, because he played last year you're looking at mid June to the end of June before you gain another year. In a year without expanded playoffs having Kirk kill it in AAA for almost 3 months while McGuire languishes with the big club isn't ideal. It isn't fair to the rest of the team, the fans or the player who you're manipulating service time on.