When told your car needs a valve job, what does that mean

A valve job is removing the cylinder head(s) from the engine so the valves, guides and seats can be refurbished to restore compression and oil control. A valve job may be necessary by the time an engine has 80,000 or more miles on it, or to fix a "burned valve," compression or oil burning problem.
Before we describe all the steps that a typical valve job involves, we should warn you that some shops don't necessary do all the steps. In other words, you get what you pay for. A "cheapie" valve job might skip a lot of things that saves you a few dollars in the short run, but may end up costing you a lot more in the long run. So look for a shop or service facility that does quality work.
A valve job typically begins by disassembling, cleaning and inspecting the cylinder head. Cast iron heads are "Magnafluxed" to check for hairline cracks. This involves applying a strong magnetic field to the head and sprinkling iron powder on it. Cracks disrupt the magnetic field and attract the iron powder, making invisible cracks easy to see.
Cracks are bad news because they can leak coolant into the combustion chamber damaging the cylinders and/or causing the engine to lose coolant and overheat. If cracks are found in any critical areas of the head, the head must either be repaired or replaced. Cracks in cast iron heads are most often repaired by "pinning" (installing a series of overlapping threaded pins). Cracks in aluminum heads are very common and can often be repaired by welding.
If a head has been repaired (pinned or welded), most shops will usually pressure test the head afterward to make sure there are no leaks. Some may also apply a sealer compound to the inside of the water jackets as added insurance against future leaks.
Once the head passes this point, it is also checked for flatness. The surface of the head must be flat to seal the head gasket against the block. Excessive warpage, roughness or any damage can cause the head gasket to fail. If the head exceeds the maximum allowable out-of-flatness specs, it must be resurfaced or replaced. Usually there's enough metal in the head to allow for a certain amount of resurfacing. But on many import aluminum cylinder heads, the amount of resurfacing that's possible is minimal.
Overhead cam aluminum cylinder heads are often found to be warped (usually the result of overheating). If the condition cannot be corrected by resurfacing, the head can often be straightened by heating it in a special oven and then bending it until it is straight.
Next come the valves, guides and seats. The guides are checked for wear. They're almost always worn, so they either need to be replaced, relined or knurled (a process whereby grooves are cut into the inside diameter of the guides to decrease the bore size). Few shops knurl guides anymore. Most install new guides, guide liners or bore out the old guides to accept new valves with oversized stems. Aluminum heads have cast iron or bronze guides that can be replaced but most cast iron heads do not.
If the valves are to be reused, they will be inspected, checked for straightness then refaced. Many shops automatically replace all the exhaust valves to reduce the risk of failure (exhaust valves run much hotter than intakes and are much more likely to fail).
The seats in the head are either cut or ground to restore the sealing surface. If a seat is cracked or too badly worn to be refaced, the seat must be replaced. If that isn't possible (as is the case on many late model cast iron heads because the casting is too thin), then the entire head must be replaced. All aluminum heads have hardened steel seats that can be replaced.
The valve springs are all inspected and tested to make sure they are still capable of maintaining proper pressure. The spring retainers, keepers and other hardware is likewise inspected. Any worn or damaged components are replaced. New valve guide seals are always used.
The valves are then installed in the head and shimmed to restore proper valve height. This is necessary because machining the valves and seat alters their dimensions. Valve height is important because it affects valvetrain geometry and guide wear. If it is an overhead cam engine, the cam is also installed and the valve lash adjusted prior to returning the head to the customer

This means that the engine top must come off, the valves are what lets fuel into the engine cylinder and lets burnt fuel out to create power, they are exposed to tremendous heat and wear and sometimes they start to leak.. a very pricey job.