The words she's, shes sound the same but have different meanings and spellings. Why do she's, shes sound the same even though they are completely different words?
The answer is simple: she's, shes are homophones of the English language.
Contraction of she is: She's going away for the weekend.
Contraction of she has: She's been to the symphony twice this month.
Plural form of she.
Definitions from The American Heritage® Dictionary of the English Language, 4th Edition, from Wiktionary, Creative Commons Attribution/Share-Alike License and Wordnik.
Homophones (literally "same sound") are usually defined as words that share the same pronunciation, regardless of how they are spelled.
If they are spelled the same then they are also homographs (and homonyms); if they are spelled differently then they are also heterographs (literally "different writing").