With very small babies the head is usually supported by the upper part of the back panel. With bigger babies you should use the headrest, when your baby sleeps. Connect the snap button on the side of the headrest, where the baby's back of the head is, with the snap button on the shoulder pad (1) and keep the side where the baby's mouth and nose are (2) free and open so that your baby can breathe easily. 

PS: Have a closer look at how wonderfully the baby is wrapped in the carrier. The wrap fabric fits the baby´s body exactly and it reaches from knee to knee. Super comfy.