1) Definition

ShiftShift Instance
One or multiple days of shift that occurs at arbitrary dates. Can have different time and person on each day.
One of the days of the shift. You can have different shift time and person on duty on this day. 
Shift instance only used in repeating shifts.

2) For repeating shift, it has shift series and shift instance. In short, the employee should work based on the Shift Instance or Parent Shift?

Always refer to the Shift Instance.

This is because, 

-if no update was applied to the shift instance, the employees assigned & time is always following the parent shift.

-if the admin has updated the shift instance, we would show the updated shift details on the instance.

Here is a scenario to help you have a better understanding

Let's say you have created a shift called "Aug Mon Shift". The shift duration is from 3 Aug 2020 - 31 Aug 2020. It repeated every Monday.

On 17 Aug(Mon), you need more human resources. So, you have added the employee "Wei Tian Zhon" to the shift. And you also have changed the time to 10.00am - 7.00pm.

So, every Monday in August, except 17 Aug, the 3 employees assigned(Cc Ya Ong, dev01 f and dev02 f) have to work based on the parent shift timing: 8.00am - 5.00pm. 

However, on 17 Aug, the employee "Wei Tian Zhon and the 3 default employees have to work from 10.00am to 7.00pm.