As I understand it, it is an airline term for deliberately putting a number of connecting passengers onto the first leg of a multi-leg flight knowing that due to known delays. there is no way that they will make the connection on time. It's called "hub-dumping" because these passengers will be "dumped" at a hub airport with no confirmed reservation for a new connecting flight.
The alternative (and the practice that is considered better customer service) is to inform the passengers before departure from the originating airport that they will not be making their connection, and offering upfront to re-route them, on another airline if necessary.