What is a pad? What is it used for?
The word 'pad' in audio is derived from Passive Attenuation Device. 'Passive' refers to an electrical circuit that requires no power to operate. 'Attenuation' means making the level of the signal smaller. 'Device' is of course self-explanatory.
You will commonly find a switchable pad in a capacitor microphone, and also in a microphone preamplifier. There isn't a lot of use for pads anywhere else in the audio signal chain but you never know when one might come in handy. A pad built into a female-to-male inline XLR is something that's nice to have in your audio toolkit. You'll need two for stereo.
You would typically find pads with attenuation values of -10 dB or -20 dB. A pad could be designed to provide any amount of attentuation but these are the most common.
The great thing about the pad is its passive nature. This means that it can accept any signal level without distortion, right up to the point where the circuit components burn out (which would be a very high level indeed).
A capacitor microphone contains an internal amplifier, which is an active (not passive) device. All active circuits have an upper limit on the level of the signal they can handle correctly. If the signal attempts to go above this level, it will be clipped at the peak level until it drops back down again. This causes very serious distortion.
So if a capacitor microphone is exposed to sound of very high level, the internal amplifier might clip. To prevent this, a pad can be switched in that comes before the amplifier, lowering the signal level before it can cause clipping.
The same can happen in a microphone preamplifier. If the input signal is very high in level, the very first input stage can clip. Once again, if a pad is switched in before the first active stage, clipping can be prevented.
The question arises, should you use the pad in the microphone or the pad in the preamp?
Some microphones can handle extraordinary sound pressure levels with ease, and if they have an internal pad available it would hardly ever be needed. So if you have turned the preamp gain all the way down to its minimum and the level is still too high, or you hear distortion, then switch in the pad in the preamp.
Other microphones struggle with high levels such as you would find close to drums, electric guitar cabinets, or a soprano opera singer. In this case the pad in the microphone should be your first choice. The pad in the preamp should not be necessary but use it if you need to.
Pads can be used in both studio and live recording.