Update 3

This person had to fire someone with a ton of lead time:

Our instutitional rules require us to inform someone by March 31st that they will be let go, but they are not terminated till June 30th. So my question was how to handle this with the rest of the team, how to let them know what was happening without everyone getting freaked out that they might be next.

I was advised to put her on a formal improvement plan. We didn't do this. My boss and I are both so burned out with her that we just want her gone. I spent most of the last year coaching and counseling a problem employee who was finally let go, and I just don't have the stomach to go through that again.

My boss, thankfully, took the task of giving the news to the employee. We told her now, instead of waiting till March, so that she would have as much time as possible to look for a new position. If she leaves before we find a replacement for her academic duties, we'll deal with that. She, of course, is not thrilled with the news but had been expecting it and has already been talking to other departments about a new job. This new job will fit her skill set much better than her current position so I'm hoping that she will get it.

I had a meeting with the two admins who will be most impacted by her leaving, and told them that the boss had said that we could hire a bookkeeper to take over that part of the work so they would not have to do it.

They very sweetly told me I was crazy, that they didn't want another admin in the mix, and that they'd be more than happy to take over her bookkeeping tasks and get the overtime. They're already allowed to work as much overtime as they want because they are so phenomenally productive. So that's taken care of.

I also told the woman who shares an office with this employee, just so that she would know what was going on if there were a lot of tears. She is a very friendly and supportive person so I knew that she would help the employee get over it.

I'm letting the employee tell everyone else in her own time and her own way.

That's about it. I very much appreciate your advice and the advice of your posters

This person had been afflicted with a bad boss and a case of nebulous firing:

I think your assessment was right on the money. I don't think I need to worry too much about receiving "a scathing reference" from the previous employer as I found out that the "bad boss" was terminated himself a few months after I left. I doubt that the new manager would choose to badmouth a previous employee based solely on things written into their record by a terminated manager. I also did not have any "contested action" from either of the 2 most recent employers when filing for unemployment compensation.

Unfortunately I am still looking for work, but I believe this has to do with the state of the economy - rather than due to any job history issues. I think that I would probably feel differently about this if I were alone in not being able to find work, but in my case - "Misery loves company" does make me feel better about myself. Hopefully the job market will start improving for everyone soon.

This person was in a new job and had a very bad feeling about it:

Your answer at the time did not really clear things up, understandably as it was a non-US situation and international rules are different. However, in the end I should have listened to my instincts and taken the loss of repaying my recruiting expenses myself and get out of what in the end turned out to be a very bad situation. The company's values did not match mine at all. They aggressivley pursued me and wanted me to start "yesterday", but once I was there, they failed on a number of things. As it was a very well respected international company I thought maybe I did not get it, and things would improve as I got to know the company. Unfortunately things did not get better, on the contrary. The amount of abuse was enormous but as it slowly got worse,it dulled how bad the work environment really was until you'd step away from it and really look. In hindsight everything is always clear! A not so pleasant parting followed after 1 year of employment, where I was placed in the un-enviable position of being a whistle blower for the company's head office.

After receiving your email today, I could honestly not remember my initial question to you and had to look it up. After all the mess of getting out of this job, I had forgotten that only 2 months in my probation, I had already questioned the situation. Today's trip down memory lane served to tell me that I should always trust that little voice and believe in myself.

In the end things all worked out for the best, I am still an expat and have landed an exciting new job where I feel well appreciated and where I can grow professionally as well as contribute to my company's success.

This person was looking at a future situation where an unliked co-worker could become his manager:

Manager is obviously closer to retirement. I still do not have the law degree necessary to move into management and am still not interested in getting one. And with the economy in the tank, I'm not looking to change companies unless it gets really bad here. Also, 2 of the 8 members of my team were laid off and one has retired, with her replacement coming on board 2 weeks ago. Team Leader feels threatened by him because he has extensive subject knowledge and experience in our area of specialization and is afraid he was hired specifically to fast-track into "her" coveted management slot. I don't know him well enough yet to get a
sense of how he would be as a manager, but I'm quietly hopeful of a good outcome.

Additionally, Team Leader is now my neighbor, having moved into a house down the street from mine over the summer. Our kids get along OK and I'm trying to build a less adversarial relationship. This is proving difficult because she takes her kids' ups and downs at school and in sports personally. For this reason, and because I think it's none of her business how my kids do in school, I have told her directly
that I don't want to make our kids' academic and sports abilities into a competition, so please don't ask for test scores.

This person disliked being interviewed by people who would be subordinates:

I just had my second interview - this time with VP's, CEO and CFO (who I would be direct report). The response did enlighten me as to the changing paradigm of interviewing. I appreciated your posting the question and also all the responses.