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Michael Scott is told by Head Office that his Scranton branch of Dunder Mifflin Paper Company might be closed down. Michael's deep rooted need to be popular triumphs over realism and he immediately promises the staff there will be no firings. Ryan, a new temp fresh from university, is shown around the office by Michael. He is introduced to Jim and Dwight whose fractious relationship is immediately clear by a fight over a stapler. In an effort to demonstrate his keen sense of humor Michael tells Pam that she has been fired for the atrocious crime of stealing Post-It notes. Pam, predictably, does not see the funny side.
Michael attempts to help out the man in the conference room, setting up chairs. He tells us that today is Diversity Day, something that he’s been pushing…been wanting to push for a long time…and corporate mandated it. Though Michael didn’t actually talk to them about it, he’s very excited.
Michael doesn't want to upset the staff so he gets Dwight to pass on news about the company's reduced health provisions. Fed up with his nosiness, Jim and Pam pretend they are suffering from a variety of conditions including Ebola, Mad Cow Disease, spontaneous dentohydroplosion, hotdog fingers, nano-robot infection, and Count Choculitis.
Michael arranges a morale-boosting birthday party for Meredith and is determined to come up with the funniest message in her card. Dwight wants a pact with Jim to fight the downsizing, and Michael regrets showing off when Oscar asks for sponsorship for a charity walk being undertaken by his nephew, who has cerebral palsy.
The office staff play a basketball game against the warehouse workers in which Jim shows off to impress Pam and upstage her fiancé who is on the opposing team.
When an attractive woman, Katy, comes to the office to solicit her purses, all of the male staffers vie for her affection, most notably Michael and Dwight. Meanwhile, Pam gets jealous of her new competition, Dwight buys a man purse in order to woo the woman, Michael recruits Ryan to clean out his car in hopes of driving Katy home, and one of the lucky workers goes home with Katy in the passenger seat.
After the annual staff Dundies awards is redlined by corporate, Michael is uncertain if he can produce the calibre of evening his staff have come to expect. Pam meanwhile develops second thoughts about her engagement to Roy while watching video footage of old Dundies award nights. Dwight hears a rumour of malicious graffitti in the female toilets and schemes to find out more. On the night, Pam has a fight with Roy after he walks out, and gets drunk with Jim. Michael is perturbed by hecklers at the restaurant but Pam drunkenly encourages Michael and saves the night from disaster. Pam ends up kissing Jim before getting a lift home with Angela.
Michael fears that a new corporate crackdown on sexual harrassment will dampen his reputation as the office 'forward king', as his best friend Todd Packer visits the office. Michael is desparate to find a new killer joke that will make everyone regret the new policies while Dwight attempts to create his own email forwarding glory. Pam's mother is due to visit and Pam is concerned that someone will be sexually inappropriate in front of her. Toby gives the staff a talk on sexual harassment which Michael derails, causing him to have to watch a training video with Kevin and the guys from the warehouse. They make a startling discovery about an actress in the video which Michael loudly declares to the staff as Jan walks in to the office with the corporate lawyer.
While Michael and Dwight are out of the office for the day trying to close a deal on a new condo for Michael, Jim and Pam arrange for the staff to participate in an "Office Olympics," where the workers play strange, invented games (among them, Dunderball, Hate Ball, and Flonkerton) that they usually play while the boss is out. At the end of the day, the festivities cheer up everyone - even the oblivious Michael.
The Office is forced into the parking lot for the day when a fire starts in the kitchen. To ease everyone's boredom, Jim suggests a game of "Desert Island" and "Who Would You Do?," where certain staff members reveal a little too much information about themselves. Throughout the day, Michael talks business with Ryan, leaving Dwight feeling left out.
While everyone else in the office enjoys the spooky Halloween festivities and talks about the staff's costumes, Michael ponders who he should fire when the threat of downsizing becomes a reality and his boss orders him to fire one of his staff. Meanwhile, Jim and Pam put Dwight's resume on job-searching websites, which may make Michael's job a little easier, and Pam encourages Jim to set his goals higher by applying for a better job, which makes Jim consider his friendship with Pam.
When Dwight embarrasses Michael by punching him in the stomach at work, Jim organizes a lunchtime rematch at Dwight’s Dojo. Meanwhile, Pam becomes annoyed at Jim when he gets too physical with her, Ryan updates the emergency contact information on a “secret mission,” and Michael tantalizes Ryan when the boss gets a hold of Ryan’s cell phone number.
When Michael and Jan try to nail down a potential new client, Christian, by taking him out to Chili's, Michael surprises everyone with what - or who - he does. Meanwhile, back at the office, Jim finds a semi-autobiographical script that Michael has written called Threat Level: Midnight, and he, Pam, Kevin, and the rest of the Dunder-Mifflin workers have a great time acting it out. Later that night, Pam and Jim share their first unofficial date, complete with dinner (a sandwich), candlelight, and Dwight's pathetic fireworks display.
Michael meets with all of his underlings to discuss their performance in the office so far. However, Michael focuses more on getting feedback about his relationship with Jan than whether or not the workers are doing their job. Later, a nervous Michael plans to shuffle through the employee suggestion box to steal exciting ideas for his imminent discussion with Jan about his own performance, but that falls apart when Jan asks to sit in on the discussion. Meanwhile, Jim and Pam try to keep Dwight under the wrong impression that the day is Friday instead of Thursday.
Michael starts monitoring the emails sent out in the Dunder-Mifflin workplace, upsetting the employees. Meanwhile, Pam believes that the relationship between Dwight and Angela is more than just worker to worker, Jim throws an office BBQ at his house in order to show his roomate the kinds of people he deals with everyday, and Michael, after annoying everyone at his improv classes, crashes Jim's party with a terrible karaoke number.
Michael hosts a Christmas party at the office, but somehow manages to decrease the holiday cheer when he changes the arranged secret Santa pairs to a game of "Yankee Swap," where everyone gives their pre-bought presents to a different, random worker. To boost morale, Michael introduces vodka shots while the others compete for an iPod, Jim hopes that his sentimental present, meant for Pam, doesn't end up with Dwight, and Angela becomes enraged about Michael's party changes.
Michael takes the entire Dunder-Mufflin staff on a motivational cruise aboard a party boat on Lake Wallenpaupack, but his planned presentation is bogged down by numerous distractions, including a dance contest, limbo, snorkel shots, and the pushy Captain Jack. Also, Jim and Katy's relationship hits the rocks as Roy and Pam finally set a wedding date, which does more than dissapoint Jim, and by the end of the night, Michael's motivational cruise doesn't go completely to waste when he shares a heart-to-heart with one of the workers.
When Michael burns his foot with his George Foreman mini-grill, he requires the entire office staff to work around his new injury. When the workers aren't so keen on obliging, Michael gets angry and calls in a man in a wheelchair to put out the message that disabled people are people too. Meanwhile, Dwight acts stranger than usual, acting really nice and helpful towards Pam. It isn't until the end of the day when everyone realizes that the car accident Dwight was in earlier that day gave him a concussion (but was overshadowed by Michael's dramatization of his own burn), and Jim and Michael immediatley take him to the hospital. Needless to say, Michael doesn't appreciate the extra attention that the doctors and nurses pay Dwight.
When Michael burns his foot with his George Foreman mini-grill, he requires the entire office staff to work around his new injury. When the workers aren't so keen on obliging, Michael gets angry and calls in a man in a wheelchair to put out the message that disabled people are people too. Meanwhile, Dwight acts stranger than usual, acting really nice and helpful towards Pam. It isn't until the end of the day when everyone realizes that the car accident Dwight was in earlier that day gave him a concussion (but was overshadowed by Michael's dramatization of his own burn), and Jim and Michael immediatley take him to the hospital. Needless to say, Michael doesn't appreciate the extra attention that the doctors and nurses pay Dwight.
When someone soils the carpet in Michael's office, Michael sees it as a form of hatred towards him and realizes for the first time that not everyone may like him. Due to the odor of his office, Michael temporarily switches workspaces with Jim, and while there, Michael reminisces of his pre-management days, reliving pranks with Dwight that he and Todd Packer played on the staff. Meanwhile, Jim realizes why Kelly sits alone in the back of the office as he plays messenger for a childish flirtation between Kelly and Ryan, and Pam tries to cope with the day without Jim to make her laugh.
Jan holds a "Women in the Workplace" seminar at Dunder-Mifflin for the paper company's female employees. Michael, feeling more than a bit left out, decides to have his own "seminar" when he takes the male workers down to the warehouse.
The Dunder-Mifflin staffers join in kindergarten-like festivities for Valentine's Day while Michael heads to New York City for a conference with the corporate heads. After showing the documenters a tour of his favorite city, Michael accidentally lets slip to the others at the conference that he and Jan hooked up, and he finds himself in hot water when Jan and the new CFO of Dunder-Mifflin hear the story. Back in Scranton, Pam becomes irked when she discovers that Roy hasn't gotten her anything for Valentine's Day, Dwight struggles to find a gift for Angela, and Kelly talks off Jim's ear about her rather desperate affections for Ryan, who is less than interested.
Dwight must confront his fear of public speaking when he is named Dunder-Mifflin's Salesman of the Year. To prepare for a big convention where he is set to give a speech, Dwight turns to Michael to guide him in his quest to conquer the fear. Meanwhile, Pam gets wrapped up with wedding plans, but Jim has plans of a different sort: an escape route out of Dunder-Mifflin and Scranton, at least for long enough so that he doesn't have to witness Pam's wedding. While all of this is happening, the staffers battle it out over control of the thermostat.
A routine office day is changed when children come to Dunder Mifflin for "Take Your Daughter to Work Day." Michael is surprised when he strikes up a friendship with the five-year old daughter of his sworn enemy, Toby. Pam is desperate to befriend her colleagues' offspring and a misunderstanding puts Ryan under Stanley's thumb..
As Kevin and the rest of the crew worry about Kevin's medical test results to see whether or not he has skin cancer, Michael gets angry because no one seems to have fun at the birthday party he threw for himself. Later, Michael takes everyone out to the skating rink to get their minds off of Kevin's possible complications, and Pam and Jim go to the supermarket to pick up some presents for Kevin.
Dwight plays the role of Volunteer Sheriff after finding half a joint in the Dunder Mifflin parking lot leading to an investigation. Pam gives Jim a play challenge where he must be silent until he gives Pam a can of Coke.
Angela is using the photo copier and Kevin is standing at Pam's desk, drumming his fingers on the counter. He asks Pam if she has found a band for her wedding yet. Pam tells him no. He tells her that he is in a band. Cut to Jim telling camera that he sometimes overhears Pam planning her wedding but he's fine with it. She has to listen to him planning his social life and they both have to listen to Dwight ordering deer urine off the internet, so it all levels out.
In the season finale, Dunder-Mifflin holds a Casino Night in the warehouse to benefit charity. While Michael faces the task of juggling two dates, Jim is forced to ponder the reality of transferring to the Stamford branch and what that means for his relationship with Pam.
This 10-part Web-only series fills in the gap between the end of Season Two and the beginning of Season Three. The episodes are available at the official NBC website. "The Books Don't Balance" The accountants inform Jan that the books don't balance and $3000 is missing. "Phyllis" The accountants question Phyllis and she makes a confession. "Meredith" The accountants question Meredith about the missing cash. "Someone in the Warehouse" Kevin thinks Angela has a crush on Roy, who ends up being questioned. "The Memo" The accountants type a memo for the thief to come forward. "Things Are Getting Tense" With new developments, the accountants start turning on each other. "Michael's Office" The accountants check Michael's office for evidence of the money. After finding nothing, Oscar and Kevin decide Angela must talk to him.
On the heels of Casino Night, Michael inadvertently outs a gay employee; Jim adjusts to his promotion, new office, and life without Pam.
Michael and Dwight head off to Philadelphia to meet Jan for the Northeastern Mid-Market Office Supply Convention. Michael, with the help of Dwight, sets up a party for fellow conventioneers while Ryan goes on a double date with Kelly back in Scranton.
Michael is in trouble once again as Jan busts him for declaring it's "Movie Monday" where everyone watches a movie and neglects work. Angela pushes Dwight to make a move on Michael's job while Pam and Jim find creative ways to waste time.