In the following test cases some letter-spacing and word-spacing properties, expressed in em units, are applied to a box having font-size: 2em (grey, with vertical stripes.)
In IE7-/Win if the box has no hasLayout, then the font-size unit used to compute the values of the above properties is not the one specified on the box itself (as it shoud be), but the one on the parent (body.)
normal letter-spacing hasLayout false
normal letter-spacing hasLayout true
positive letter-spacing (0.5em), hasLayout false
positive letter-spacing (0.5em), hasLayout true
negative letter-spacing (-0.25em), hasLayout false
negative letter-spacing (-0.25em), hasLayout true
normal word-spacing hasLayout false
normal word-spacing hasLayout true
positive word-spacing (1em), hasLayout false
positive word-spacing (1em), hasLayout true
negative word-spacing (-0.25em), hasLayout false
negative word-spacing (-0.25em), hasLayout true
A somewhat similar problem with margins: IE7-/Win: font-size, hasLayout and em margins on inline elements