Scratch Time is the name given to the timezone (-05 EST) that displays dates in the forums. "Scratch Time" is based on the timezone of MIT (where Scratch was developed).
Scratch Time is based on an old glitch in the Scratch Forums that can be reached by attempting to change the timezone display in the forums. Users can change the number, but despite clicking on "Submit", the number will be set back to -05 EST.
It has been reported several times over the years, but was only fully brought to light when Jonathanpb brought the issue up again in late December 2009 .
After a discussion, ScratchR andresmh said to think of the timezone as "Scratch Time". It was understood that the timezone forum glitch was not going to be changed any time soon, and so it was called Scratch Time.