Either way (dumping on top or burying) is fine, but both methods may have some influence on the processing speed of the food.
Worms don't eat fresh material. First microorganisms need to soften the food and start decomposing it, only then will the worms eat it. Most people don't care much about how fast food is processed and simply dump it on top of the bin. This will work fine, but there are two things you can do to speed up the decomposition process:
- Chop up the food in smaller pieces. Some people even blend the food into a puree, but personally I think that's a waste of energy.
- Create pockets or holes in the top layer and fill those with fresh food. The idea is that by using pockets, a larger surface of fresh food comes into contact with microbes already living in the bin and the material will decompose quicker (not sure if this have been scientifically proven).
Burying food is similar to creating pockets, but in this case more food is exposed to microbes so decomposition should be a bit faster even. However, if you bury food you may disturbe the worms and cause them stress which may slow decomposition down.
Personally I don't like to bury food. I'm not sure how much worms will suffer from stress, but for me it is mainly because I'm not convinced it will speed things up much, plus I'm just don't care much about speed. Most of the time I just dump chopped food on top, but occasionally a create a few pockets with some top material and use those into they are full. The only time I will bury food is when I have a fruit fly infestation, but then I bury wet fresh material under dry fresh material (e.g.paper towels or cardboard).