Cascading replication - where a standby can connect to an upstream node and not the primary server itself - was introduced in PostgreSQL 9.2. repmgr and repmgrd support cascading replication by keeping track of the relationship between standby servers - each node record is stored with the node id of its upstream ("parent") server (except of course the primary server).

In a failover situation where the primary node fails and a top-level standby is promoted, a standby connected to another standby will not be affected and continue working as normal (even if the upstream standby it's connected to becomes the primary node). If however the node's direct upstream fails, the "cascaded standby" will attempt to reconnect to that node's parent (unless failover is set to manual in repmgr.conf).