Ported or manifold vac for overdrive bypass vac switch?

"NO" connection without the vacuum hose connected bypasses the switch function entirely. This could have been done because the microswitch failed or just out of confusion. Move the connection to NC, connect the vacuum hose and it should function properly or you can test it first with a test light. There should be power at both connections when the engine is idling AND power at only one connection key on, but not running.

"NO" is short for "Normally open". "Normal" is without the button being pressed on the microswitch but the vacuum portion presses the button with no vacuum applied, making "NO" closed and "NC" open. With at least 7 inches of vacuum applied, the vac spring is compressed enough that the microswitch button can go back to the actual normal position as if there were no vacuum switch.