You just had someone come into your office and admit a mistake. A big one. What’s next? Oh, did I mention that they are already on a performance improvement plan? What do you do now? First off thank them for admitting the mistake. Next, what if you replace this person immediately. Is the replacement going to make the same $50,000 dollar mistake? You might want to think of the mistake as tuition. The current employee is realistically not going to do that again (unless there are underlying reasons that you might lead you to think otherwise). Do you want to pay tuition twice? Was the mistake a brand new one? Does your process have a mechanism for trapping this? If not, change your process. Was it a willful act or just a stupid mistake and bad judgment? So if the employee is a good team member, show them some mercy and grace but make sure they understand what is expected. For those that might complain about special treatment for that employee, let them know that they might be the next person who needs the same. You never know when you will be next.