"Reclaimed" fabric is a nicer way to say "second hand". It refers to fabric that has been obtained from a used source. Used towels (terry), t-shirts (jersey), sheets (flannel) etc. are some examples. Denim from jeans and other possibilities are up to the pad maker.
The fabric used IS NOT from old pads!
These are washed before being used, so they are no more "unclean" than buying second hand clothing, and are a much more environmentally friendly alternative to buying fabrics from new. It also gives interesting patterns and designs not able to be bought as fabric itself.