Overload Saber makes your next 3 melee (white damage) attacks put a dot on the target.
That DoT stacks 3 times max, 1 melee attack = +1 to stack.
Mind you Overload Saber has a time limit too, so you can't enable it then wait a minute to start stacking.
As for your specific problem, the DoT should be up after 3 melee attacks.
Problem is, the DoT icon on your enemy is the same as Cauterize (unless it's stacked, in which case it shows how many stacks it has).
Also note: Overload Saber doesn't always work when you press it (specially mid air), so you have to press Overload Saber hotkey MULTIPLE times for it to trigger.