As I understand it, the origin is where a body part attaches tothe character. You can have different origins for the head, arms, etc.
Use the pen tool, click on the body part, name the new layer "Origin", and put it where you want it in the layer hierarchy
To expand on what Jerry said... if you don't create an explicit "Origin" handle/layer for a puppet, the center of the layer's bounding box will be used as an implicit origin. An explicit "Origin" handle/layer allows you to use some location other than that center, which is helpful if you want your head to rotate around a location closer to the chin, for example.