Welcome to Dunder Mifflin Paper Company’s Scranton branch. Unprofessional boss Michael Scott manages to distract, insult, mislead or otherwise obliviously irritate his employees. Including shy receptionist Pam, cheeky but bored salesman Jim, officious and negative salesman Dwight and the new guy, temp Ryan. Jan Levinson-Gould, Michael’s superior from the corporate office arrives to warn him that either the Scranton or Stamford branch will be closed down due to downsizing.
Mr Brown of Diversity Today comes to lead some Diversity training. Michael interrupts his session and won’t sign a form to indicate he completed the training. It turns out that Michael was the only employee who was required to complete the training after performing a Chris Rock monologue. Michael decides to lead his own Diversity training session with typically disastrous results. Meanwhile Jim loses his biggest client to Dwight.
Michael has to pick a cheap health care policy for the Scranton branch. Sensing that the budget plan will be unpopular he hands the work over to Dwight. Dwight takes great pleasure in slashing benefits to save the company money. The rest of the office is angry and Michael hides in his office. When a group of employees corner Michael he once more defers to Dwight before promising a big surprise. At day’s end the Scranton branch has a poor health care plan and Michael has no surprise.
With rumours of downsizing in the air, Dwight asks Jim to form an alliance with him. Jim agrees and uses the opportunity to mess with him. To boost morale Michael decides to celebrate Meredith’s birthday a month early. He obsesses over writing a funny joke in her card, which of course backfires. Then when celebrating his prank with Pam, Jim is touching her a little too familiarly as Roy walks in.
Michael arranges a basketball match between the office and the guys in the warehouse. He irritates the office workers with his team selection. Then he goads Darryl, the warehouse foreman, into gambling on the result of the game. The losing team will work on Saturday. Jim impresses on the court during the game, annoying Roy with his skills. Roy “accidentally” elbows Jim in the face. Michael tries to end the game with his team ahead but everyone sees through what he is doing. He backs down in the face of the warehouse guys.
Katie is selling handbags in offices. Michael is attracted to her and so invites her to work from the conference room. He and Dwight both unsuccessfully attempt to woo her during the day. In the end Jim asks her out and they head off to get a drink together.