What exactly is “morale”?
Morale is a system that is similar to Hit Points, but doesn’t cause the unit to die when it reaches zero. All weapons inflict some form of Morale damage, as well as normal damage, be it a little or a lot. When a squad’s morale is broken, it’s accuracy is drastically reduced. Damage remains normal, just the chance of actually hitting the target is very low. A squad will always be gain morale if they lose it, but if they remain under fire they will most likely not gain enough to become unbroken.