em means the text size isn't fixed. Basically the user can change the text size when viewing the site (CTRL+mouse scroll or View-Text Size), making it more HCI-friendly.
Further to the above, I find the easiest way to use it is to set the body font size at 62.5% which will make 1em = 10px on most browsers (provided the user has left the font on default). This now makes it really easy to figure out proper sizes.
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