Pressing and holding the reset button causes a bypass. The device is not in control of the HVAC system during the time the button is held pressed. The thermostat controls the HVAC directly (as if no device is present between these).
When the HVAC system is not in use and only the fan is chosen to be used (is set to ON), if the red button is pressed the fan may turn OFF for about ½ of a second.
The graph at the top right shows how the device takes over the thermostat’s signal.
The graph at the bottom right shows how the device is bypassed at some point after the compressor and the fan are turned OFF by the device.