I currently work in Chicago but I'm from South Texas. My boss seems to get a real kick out of my pronunciation of the word "pen".
We have to go to him for supplies and he always make me repeat myself whenever I ask for one and laughs incessantly. He says that I pronounce the word "pen" is funny. My ignorance must shine through because although I've tried to understand the "sound" difference between "pin" and "pen", I just can't. You write with a "pen", you stick something to the wall with a "pin".
He states that I say "pin" when I should say "pen". When back home in Texas, when asked for a "pen", I've never given someone a "pin" or the other way around. So I don't understand how he hears a difference.
Jim already knows the facts here: there are distinctions between vowel categories that he doesn't make, at least in certain contexts, and can't reliably hear. He also knows, I'll bet, that there are distinctions he makes that other people can't make or hear — many native speakers of Spanish who learn English as adults, for example, can't reliably perceive or produce the difference between the vowels in bid and bead or sip and seep.
Mergers of this kind are common, both within languages and in the speech of adult learners. As Jim notes in his own case, such mergers don't generally cause much misunderstanding. Language in context is redundant enough, by cultural evolution if not by design, that misplacing a feature or two rarely results in a plausible lexical subsitution. (Of course there are many stories, and quite a few jokes, that depend on the minority of cases where it works out the other way.)
But Jim seems curious about what's going on here, so what should he do? It might help him to learn the IPA symbols for the pronunciation distinction that his Chicago acquaintances make: [pɪn] vs. [pɛn]. He already knows that "pin" and "pen" have different standard English spellings, but English orthography is variable and confused, especially in the case of vowel sounds, and so maybe seeing the distinction in a phonologically consistent spelling system would help. Or maybe it would help him to hear and practice the pronunciations of these vowels in the context of the vowel quadrilateral more generally.
He can find plenty of scholarly work on the pin-pen merger itself or on similar phenomena. I don't know what his work environment is like, but it's possible that a couple of extended dead-pan discussions of the phonetic, historical, geographical, and social extent of other American English vowel mergers — cot-caught and Mary-merry-marry-Murry are probably the best studied — would reduce his boss's enthusiasm for the topic.
If Jim really wants to learn to hear and produce a difference between pin and pen, he has some options. There's evidence that "high variability phonetic training" (HVPT) works, at least sometimes and to some extent — but I don't know of any suitable free implementations. (N.B. Collecting the needed recordings for HPVT in a couple of common cases, say English vowels and Mandarin tones, and writing a simple web-based interface for such training in general, would be an excellent project…) He could consult a good dialect coach and learn to style-shift between South Texas and Chicago.
I should note in passing that Jim's description of his experience sounds a little unusual to me.
It's absolutely normal not to be able to reliably hear or pronounce a distinction that not part of your native phonological system. This is an experience that I've had every time I've encountered a new language, or a new variant of English. But usually people can hear that a minimal pair, performed side-by-side in the over-distinct facultative style of such productions, is in fact different; and usually it's fairly easy to learn to identify which member of such a pair is which.
This ability doesn't generalize to identification of unpaired examples across speakers and contexts and styles. Achieving that generalization is the goal of HVPT. But Jim seems to having trouble with the first step, before generalization enters the picture at all. Most likely this is because his boss is apparently motivated to be the opposite of cooperative and helpful. But if not, we should look into Jim's perceptions — and those of other Texans — more carefully.
[Update: It's common to find that discrimination is esssentially no better than identification, for a continuum of stimuli representing a consonant distinction. This is the classical "categorical perception" situation, and the classical interpretation is that all you can consciously hear -- or at least all you can remember -- is the identification returned by an "encapsulated" mechanism for perceiving over-learned phonological categories.
There's some controversy as to whether this is entirely true even in the classical cases; but it's always been recognized that vowel categories generally don't work this way. As with colors, pitches, light or sound intensities, etc., people can generally discriminate vowel sounds much, much more finely than they can assign them to categories.
So if it really were true that Jim T. was entirely unable to discriminate (better than chance, as usual) among stimuli on an articifial continuum from "pin" to "pen", that would be an interesting surprise.]