It's when a pullet actually squats, lowers her body and holds very still, so the rooster can mount her. When a pullet (or hen) squats for a person (or the family dog, even) it means she is showing submissiveness to someone with HIGH rank in the pecking order, equivalent to that of the rooster's. Some of them will also do a little foot stamp at the same time.
Do a search HERE in BYC for "squat" or "squatting" and a lot of threads will pop up for you to see. There have been some members who have uploaded videos of a hen squatting to You Tube. You'll find those links in those posts.