They are not trying to earn another degree, as you said a doctorate is a terminal degree. The term usually signifies an intense period (a week to several months in length - some are even longer) of research or study or scientific investigation with a foundation, science institute (the CDC), research organization (History - National Archives).
I have had two occasions to spend several weeks of concentrated study at the USHMM and two occasions to spend several months working in the National Archives. These opportunities made me more valuable to my university and strengthened my chances of being promoted.
The goal of Post-Graduate Study is usually to (1) get one's foot in the door in a particular field, or (2) to have additional advanced and practical experience in one's field before trying to secure a full time position elsewhere, or (3) a way to stay current in one's discipline until a full - time position opens up.
Usually, these are competitive positions; they do not usually pay that well, and some not at all, but they are highly sought after, well - respected, and are a great addition to a resume or Vita. Hope that helps. :)