He is a puppet version of SpongeBob, bearing a similar appearance to him. ChefBob is made out of a brown paper bag and "wears" white drawn-on square pants with long sleeves, a red tie, and a chef's toque blanche. He is drawn with blue eyes and big eyelashes, just like SpongeBob himself.
Role in episode
When SpongeBob gets stage fright, he decides to make ChefBob out of a paper bag lying under the grill. ChefBob is at first inanimate and entertains the customers while being controlled by SpongeBob, but after he overhears Squidward quietly insulting a customer, he comes to life and starts targeting the customers with offensive jokes. After the puppet insults Mr. Krabs and Squidward, SpongeBob tries to dissuade ChefBob from using verbal abuse. This fails, and he proceeds to hit SpongeBob with a rubber chicken, who hits him back and the two partake in a brawl.
The customers are driven away by the brutality, and Mr. Krabs breaks it up by removing ChefBob from SpongeBob's hand and firing him with his own puppet, and having Squidward, also using his own puppet, toss him onto the road where he is ran over.
At the end of the episode, the Krusty Krab crew sees ChefBob, much to their horror, is revealed to be still alive and the star of his own TV show, ChefBob Cooking with Insults. Seeing him as a sentient being and famous, caused them all to faint.
ChefBob insulting the customers is a reference to the famous chef, Gordon Ramsay.