Litigation involving the dismissal of residents has increased in the past decades. A review of relevant court decisions and their implications for residency training programs is provided. To assure due process in such cases and to help programs deal fairly with situations involving problem residents that may never come to frank dismissal, a set of guidelines to assist training programs in dealing with residents "in trouble" is presented. The guidelines were developed collaboratively at University of California at Los Angeles (UCLA) and the University of Southern California (USC) and were reviewed and approved by the local hospital, university, and Veterans Affairs counsels to assure compliance with institutional policies and procedures regulating due process for employees and students. The guidelines were also reviewed and approved by an American Association of Directors of Psychiatric Residency Training (AADPRT) task force, but they were never published or widely distributed. Although modifications of these guidelines may be required to meet local educational or institutional variations, or to meet variations in state law or precedent, these suggestions provide a useful template with which to develop adequate and effective due process procedures.