Peter Gibbons (Ron Livingston) is a programmer who spends his days updating bank software to remedy the then-expected Y2K disaster. His co-workers include Samir Nagheenanajar (Ajay Naidu), whose last name no one else can pronounce; Michael Bolton (David Herman), who is pissed off that he shares his name with the real-life singer; and Milton Waddams (Stephen Root), a soft-spoken, fixated collator who mumbles to himself incessantly and is repeatedly walked on by management, especially the hollow office manager, the soulless Bill Lumbergh (Gary Cole). Lumbergh—a stereotypical corporate middle-manager who spends most of his time wandering the office coffee mug in hand, wears white-collared shirts and suspenders, and emotionlessly micromanages his employees while engaging them with superficial small talk—is Peter’s nemesis.

Meanwhile, Peter is stressed, burnt out, and ineffective, and will likely be first on the Bobs’ downsizing list. Fortunately, something unusual happens during the occupational hypnotherapy session urged upon him by his soon-to-be ex-girlfriend—the "occupational" hypnotherapist (Michéal McShane) suddenly dies before he can snap Peter out of a state of complete relaxation. The newly-relaxed and still half-hypnotized Peter announces that he will not work anymore, instead pursuing his lifelong dream of “doing nothing,” and finally asking out Joanna (Jennifer Aniston), a waitress he’s long wanted to date. During his interview with the Bobs, Peter unreservedly speaks his mind about the absurdity of his job and of how Initech is run. The Bobs misinterpret Peter’s candor, easygoing attitude, and the valid points he makes as evidence of a corporate executive mentality. Much to his surprise—and Lumbergh’s dismay—Peter receives a promotion while his friends Samir and Michael, two of his department’s best employees, are going to get canned.

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Office SpaceIn order to get back at the company, the three friends decide to infect the accounting system with a computer virus which will round down fractions of a cent from accrual of interest and transfer the leftovers into their own account (see salami slicing). Peter, when questioned by Joanna about what he and his friends had been celebrating, attempts to diminish the sense that he is doing something illegal by comparing the theft to taking the pennies from the penny tray at a convenience store. However, it takes $305,326.13 in one day and the three friends are certain that such a large amount going missing in so short a time period will be noticed and that they will go to jail. After a crisis of conscience, Peter decides to write a letter in which he takes all the blame for himself. Peter slips the envelope with the letter and the money (in unsigned traveler’s checks) under the door of his boss’s office.

However, all their problems are solved when Milton snaps after Bill Lumbergh takes away his beloved red Swingline stapler and moves his desk yet again, this time to the cockroach-infested Storage Room B in the basement. Milton then sets fire to the boss’s office, which destroys the entire building, including all the computers and the virus code. Peter finally finds a job that makes him happy (working construction with his gravel-voiced neighbor Lawrence), Samir and Michael get jobs at Initrode (a rival company), and Milton makes his way to the Caribbean with the traveler’s checks.

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