Salary Cap Exceptions
There are quite a few ways NBA teams can exceed the salary cap, but most of them have to do with signing free agents. Some of the most common exceptions include:
The "Larry Bird" exception, which allows teams to exceed the cap to re-sign their own players
The "Mid-Level" exception, allowing teams to exceed the cap in the amount of the NBA's average player salary for that year. The mid-level exception can be given to one player or split between several.
The rookie exception, which allows teams to sign their draft picks even if doing so would exceed the salary cap.
The minimum-salary exception, which allows teams to sign players to two-year contracts at the league minimum salary even when over the cap.
The owners' initial proposals for a new collective bargaining agreement reportedly eliminate all of these exceptions in favor of a "hard" salary cap that cannot be exceeded for any reason. The National Hockey League employs a hard cap, as did the National Football League, until their collective bargaining agreement lapsed.