Some departments teach more than one year-group per class, eg Higher Physics contains S5 and S6 pupils. The multi-year department class component allows you to combine pupils from different year groups into one class.
Creating a class like this has a number of advantages. Pupil registration is straightforward, since all pupils appear in the one class. Preparing reports, tracking & monitoring are also more straightforward since staff have ready access from their class list, from a single screen.