This definition is used to differentiate between regions and that way determine use of staff across locations.
A staff member can be defaulted to a fixed location (see the Employee List, Work Location field), which will automatically include the employee in the roster plan at that specific location. Other employees can be added to a roster plan, given that they belong to the same region as the roster that is being scheduled.
For example, if you have defined two locations in a hotel, the restaurant and the front desk, you must define one region. In this example that region is called Hotel. So when you have defined a region, you can allocate both locations to this region. Following this procedure, you can include employees from one location to another: an employee, who normally works at the front desk, can now be assigned a shift in the restaurant.
Note: It is not necessary to define regions if you only have a single retail store or a restaurant. This is because in that case you only have to define one location.