Correct. The mini-toggle controls how the neck humbucker is configured (series coils, parallel coils or split to a single coil), and the 4-way lever switch controls which pickup or pickups are selected and how they are combined.

I should mention that the wiring diagram above doesn’t show the bridge plate ground wire, but you should always connect one. That is, a bare wire that sits under the bridge base plate and runs through a hole in the body to the control cavity (or pickup cavity) where it connects to a ground point (usually the back of a pot). A standard Tele kit should have the hole pre-drilled, so all you have to do is remember to add the wire before you screw down the bridge.