This is a great way to gather large amounts of fabric using your overlocker. The picture above shows what happens after it goes through the needle.
Use these settings (or fiddle around to get what works best, or check your manual)
Stitch length 5
Needle thread tension 6 to 9
Upper looper tension 3 to 4
Lower looper tension 3 to 4
then serge away! Just keep a reasonable lengths (tails) of chain at the beginning and the end so that if you need to reduce the gathers you have enough thread so it does not unravel. Much faster than stitching 2 rows of basting stitches and pulling up.
You can see how well it worked on my ruffle aprons here.