It does as labeled. Limits the performance of the engine to enable max performance without damaging the engines. In an emergency (ie single engine operations) the limits can be removed to get geater thrust but could lead to engine damage.

Most modern engines are controlled by a number of factors, LP or HP spool speed, engine jet pipe temperature, accel and deceleration. All depends on what is asked from the pilots as to what limit it uses. If the limiters are overiden then the engine operates at the high end of its maximum limits. Generally it max temp. This can cause thermal damage throughout the engine. Turbine blades start to melt, nozzle guide vanes burn through.  Normally an engine change is required after prolonged use.

Dax