What is the NBA Disabled Player Exception?

Keith Smith
Keith Smith, Resident NBA ExpertNovember 15, 2022
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© USA TODAY Sports

When NBA teams lose a player for the season due to injury, they’re limited in how they can replace that player. There is no injured reserve in the NBA. Unless teams are down several players, they don’t get an extra roster spot.

The NBA functions under a soft cap, but with a hard cap limiter that can be triggered in some situations. That can make it hard to sign a replacement player. By the time the season starts, the vast majority of teams are already operating over the cap, with limited resources available to sign a player.

There are always trades, but in that case, you might be robbing Peter to pay Paul and creating another roster issue for yourself.

However, the NBA does have one tool that teams can apply for when they lose a player for the season. The Disabled Player Exception is an exception that teams can be granted to help replace an injured player, but there are some restrictions.

Here’s a quick Q&A as to what a DPE is and how they can and can’t be used.

 

How do teams get a Disabled Player Exception (DPE)?

Teams have to petition the NBA in order to be granted a DPE. It’s not an automatic thing when a player is injured. A team must apply to the NBA for a DPE.

From there, it’s up to either an NBA-designated doctor or the league’s Fitness to Play panel to determine the extent of the injury to the player the DPE is being asked for. If the determination is made that the injured player is substantially more likely than not to miss the rest of the season, the DPE is granted to the team that petitioned for it.

Teams have until January 15 of each season to apply for a DPE. If a player is ruled out for the season after that, teams cannot petition for a DPE. If a player is deemed to be out for the subsequent season, the team will need to reapply during that next league year for a new DPE.

 

How much is a DPE for in terms of salary?

The DPE is worth one-half of the injured player’s salary, with a maximum value equal to that of the Non-Taxpayer Mid-Level Exception for the season in which the DPE is granted.

Example: If the injured player’s salary for whom the DPE is granted has a salary of $10 million for the 2022-23, the DPE value would be worth $5 million.

If the injured player was making $30 million for 2022-23, the DPE value would be capped at $10,490,000, which is equivalent to the Non-Taxpayer MLE for the 2022-23 season.

 

How can a DPE be used?

The DPE is a unique exception from other salary cap exceptions. Exceptions like the Non-Taxpayer Mid-Level, Taxpayer Mid-Level, Room and Bi-Annual Exceptions are signing exceptions only. They must be used to sign a free agent(s).

Traded Player Exceptions (TPE) can be used in two ways: teams can trade for a player (or players) whose salary fits inside of the TPE or they can use the TPE to claim a player off waivers whose salary fits inside of the TPE.

The DPE is unique in that it can be used to sign a player, trade for a player or to claim a player off waivers. However, there are restrictions with the DPE that do not exist for the other exceptions.

 

What are the restrictions to a DPE?

Unlike the signing exceptions (NTMLE, Tax MLE, Room and BAE), the DPE can only be used to sign a player to a remainder-of-season contract.

The remainder-of-season condition also exists in trades and waiver claims as well. If a team trades for a player or claims that player off waivers, they have to be on an ending (commonly called expiring) contract. And there cannot be an option year after, either. It must be a true ending contract.

In addition, the DPE can also only be used to acquire one player. Unlike several of the signing exceptions and TPEs, the DPE cannot be used to acquire more than one player.

Essentially, teams are granted the DPE to replace the one injured player for the remainder of that current season only.

For re-signing purposes, teams do inherit whatever applicable form of Bird Rights would come after acquiring a player via a DPE.

 

Do you get an additional roster spot when granted a DPE?

No. Teams are still bound by the maximum of 15 players on standard contracts.

In a normal, non-COVID-impacted season, the only way teams can gain extra roster spots is via the Hardship Exemption. If a team has at least four players out for at least three regular season games, they can petition the NBA for a Hardship Exemption, which would grant the team an extra roster spot.

Technically, a team could fill a Hardship roster spot via a DPE. However, when that fourth player is ready to return from injury or illness, the team would need to get back into roster compliance by waiving or trading a player to get back to 15 players on standard contracts.

 

When does a DPE expire?

Unlike signing exceptions, which expire at the end of the regular season, and TPEs, which have a one-year expiration date from the date of creation, a DPE can only be used through March 10.

The idea with the DPE is to give a team an opportunity to add a player through the trade deadline and the early part of what is now commonly called “buyout season”.

A DPE will also expire when used. A DPE is also rendered void if the injured player returns or if the injured player is traded to another team.

If a team only uses a portion of a DPE, the unused portion expires, as the DPE can only be used to acquire one player.

 

Does a DPE prorate in value as the season goes along?

No. Unlike a signing exception, the DPE always retains its full value until it expires or is used.

 

What happens if a DPE is used and then the injured player returns?

Nothing. The player acquired via the DPE is unaffected. This is basically seen a stroke of good fortune that a player thought to be out for the remainder of the season was able to return.

Reminder: Because no roster spot is created through a DPE, there would not need to be corresponding roster move for the injured player to return.

 

Can you trade for an injured player and then apply for a DPE?

No. The player must have been injured while under contract to the team in order for that team to apply for a DPE.

 

Does a DPE count against the salary cap and luxury tax?

Yes, when used to acquire a player, whatever portion of a DPE is used will count against both the salary cap and the luxury tax.

In addition, if a team is hard capped at the tax apron, they cannot exceed the apron via use of a DPE. A hard-capped team is still required to have a team salary that is no higher than that of the tax apron.

 

Does a DPE offer any sort of short or long-term salary relief for the injured player?

No. There is a process under which teams can petition to have a player’s salary removed due to career-ending injury. But that process is independent of the DPE process.

 

Do any teams currently have DPEs available?

The Boston Celtics have a DPE of $3,239,500 which was granted for Danilo Gallinari.

There are no other current DPEs available for use.

 

What are some recent cases where a DPE was used?

In 2017-18, after Gordon Hayward broke his left leg on opening night, the Boston Celtics were granted a DPE of $8,406,000. That was the equivalent of that season’s Non-Taxpayer MLE, as Hayward’s salary for that season was nearly $30 million.

Boston used that DPE to sign Greg Monroe for $5 million after he was waived by the Phoenix Suns.

 

Is a petition for a DPE ever declined?

Yes. Last season, the Chicago Bulls petitioned for a DPE for Patrick Williams after he tore ligaments in his wrist early in the 2021-22 season. The NBA denied the application, as it was deemed Williams had a chance to return for that season. That proved prescient, as Williams did return in late-March.

In addition, the Indiana Pacers had also applied for a DPE for Edmond Sumner last season. However, Sumner was traded by Indiana before that DPE was granted, which rendered the application void.


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