[NOTE: Portions of this piece previously appeared at Mid-Level Exceptional]
Article VII, Section 6 (c) of the Collective Bargaining Agreement details the Disabled Player Exception.
While the Disabled Player Exception takes many characteristics of other exceptions under the Collective Bargaining Agreement, it has a few unusual and legitimately interesting nuances that make it stand out.
How the Disabled Player Exception Works
- The Disabled Player Exception is an exception to the salary cap. This means teams far under the cap get zero use from it, especially since exceptions cannot be traded.
- Unlike other exceptions, teams must apply for the Disabled Player Exception. That application can only be submitted on or before January 15 and the exception can be used no later than March 10 of that season or when the player returns, whichever happens first.
- The Disabled Player Exception allows that injured player to get back on the court. It does not work like an Injured Reserve in some sports where the player cannot return that season even if he recover but the team justifiably cannot use the exception to replace an already-returned player.
- The amount of the Disabled Player Exception is the lesser of half the injured player’s salary or the Non-Taxpayer Mid-Level Exception. Technically, teams get an extra $100,000 of wiggle room if they use their DPE to trade for a player but that is pretty much the deal.
- If approved, the Disabled Player Exception can only be used on one player. While teams can choose to split some exceptions like the Mid-Levels and Bi-Annual, the DPE cannot go to multiple players. The entire exception expires once used regardless of the replacement player’s salary. This makes sense given the purpose of the exception.
- However the Disabled Player Exception is used, that season must be the final season on the new player’s contract. This means no option years or anything of the sort. No remaining years, no exceptions.
- Generating a Disabled Player Exception does not reduce the salary of the player in question and has no impact on the luxury tax obligations of a franchise unless used. As an exception, the DPE only functions as a way for teams to add a piece to replace the injured player. The CBA does have a way for teams to apply for cap relief in cases of death and career-ending injury, detailed here.
- Teams can use a Disabled Player Exception to sign a free agent, trade for a player or claim someone off waivers as long as they fit the other requirements. This nuance separates the DPE from the MLE and BAE (cannot trade for a player) and trade exceptions (cannot be used to sign a player).
- The Disabled Player Exception is year-to-year and teams can apply for multiple seasons with the same player and injury (in some cases). Teams can only apply for the DPE during that league year and it expires before the end of the season, so it makes sense that a franchise can use the same process the following season should the circumstances still apply. When moving from one league year to the next, it can be the same injury or a new one to the same individual.
- Teams can actually apply for the Disabled Player Exception multiple times in the same season on the same player under certain circumstances. If a team applies for a DPE and the league rejects it, they can wait 90 days and re-apply for the same player. However, Section 6 (c)(8) states that the new application must be based on “a new injury or an aggravation of the same injury” meaning something new has to actually happen to the player during that time.
Applying for the Disabled Player Exception
The DPE stands out among the CBA exceptions because teams have to apply for it, leading to one of the more interesting processes in the league. As specified by Article VII, Section 6(c)(4), after a submitted application a doctor designated by the NBA evaluates the relevant medical information and the player himself should the doctor want that. Like other medical evaluations, the player in question must participate and be truthful.
The standard for granting the exception specified by Section 6(c)(2) is “any injury or illness that, in the opinion of the physician described in Section 6(c)(4) below, makes it substantially more likely than not that the player would be unable to play through the following June 15.”
If the NBA-appointed doctor determines it is substantially more likely than not the player will be unable to play through the following June 15, the team gets the exception.
However, if the doctor rejects the application for the DPE, the Player’s Association can appeal. If that occurs, the case goes to the “neutral physician” which is a truly great title. At the beginning of each league year, the NBA and NBPA agree on a doctor for this purpose. The neutral physician has the same criteria and their determination is final, binding and unappealable.
The other reason the DPE can get really interesting is the difference in standard and application here. “Substantially more likely than not” does not mean the doctor has ruled the player out conclusively. In fact, the rules governing the exception specifically talk about the player’s potential return that season in 6(c)(6) discussed above.
The Purpose of the Disabled Player Exception
Having a Disabled Player Exception helps take a little bit of the sting off of losing one of a team’s most important players. Tying the amount to the injured player’s salary means that many players cannot be adequately replaced (especially those on rookie contracts) and making the maximum amount of the exception the Non-Taxpayer MLE means that the single addition probably will not be a major player now and that will only become more true as the cap outgrows the Mid-Level Exception with the increased revenue in the new TV deal.
That said, it can be a small piece to help a team out in a bad situation. Having such a strong system in place to evaluate the injured player also makes it significantly harder for a team to attempt to game the system by getting a useful exception for an expensive player not carrying his weight, which would certainly be tempting for teams otherwise.
The DPE balances the pressure to keep competitive teams that have shown a willingness to spend above water with safeguards that make it very hard to exploit.
Example of the Disabled Player Exception: Martell Webster
Since the Washington Wizards’ application for a Disabled Player Exception on Martell Webster was approved, we know exactly what they will have to work with.
The lesser of the Non-Taypayer Mid-Level Exception and half of Webster’s salary for the 2015-16 season means that the Wizards will have an exception worth exactly $2,806,750. They can use that exception to trade for a single player in the last year of his contract (no options!), sign a single free agent on a one year deal, or claim a qualifying player off waivers.