It means you cannot cancel until 3 months are up. So you pay monthly for 3 months. Some just let you pay only a month and then move on, but some have a minimum term like yours and that's how they make 3 months worth of profit from you. After 3 months you can move on or stay, up to you.
As far as i know you are contracted for 3 months. Sometime towards the end of that time you can be laid off, but if not you are automatically contracted for another 3 months work. So on and so on. There is likely to be a notice period in there somewhere too which tells you how long before the end of the 3 months they can lay you off. And the same notice applies to you if you want to leave.