There are a number of reasons why you may need flame resistant clothing to perform your job safely, but generally they fall into two larger hazard categories: electricity and fire. Fire retardant work wear will protect you from the risk of severe burns, because the material it's made from is self-extinguishing. Depending on the specific hazards faced at your job, you will be required to wear certain types of garments with various safety ratings. You should check with your manager to find out what is necessary at your workplace.
Electrical (Arc) Hazards
If you work around live conductors or circuit breakers, you face the risk of burns from electrical flash arcs. These arcs are caused by a sudden release of energy from an electrified source, which usually happens because the breaker cannot, for whatever reason, sustain the voltage being supplied to it.
Depending on the voltages you work with, you will need to wear certain grades of flame resistant clothing, whether coveralls, a flash suit, or pants and a jacket made from this high-tech material. You will also need to wear additional PPE, including hearing protection, safety glasses and a hard hat.
Fire hazards are extremely common in workplaces in a number of industries. Sawdust is a highly combustible material, as can more traditionally thought-of materials like gasoline or chemicals. If you're exposed to these materials on the job, you'll be required to wear fire retardant clothing as well.
You should consult your manager to find out what specific types of flame resistant clothing you will need at your workplace, which depends largely upon the substances you handle each day. However, a good starting place is always a shirt and pants, which should be worn at all times when you are working.