There are three wires . An earth wire, red and white. For normal humbucking you just tape off the end of the white wire and connect the red and earth. For coil cut you then use the white wire and connect it thru an on/on mini switch.
so connected to the switch end terminals are the red and white with a common out from the centre. Check out the digram.
http://www.stewmac.com/shop/Electronics,_p...GE.html#details
I have one of my guitars set up with two mini switches for single coil operation or a combination.