Though the institution was prohibited by the World Government over 200 years before the current storyline, slavery still survives in certain places in the world, Sabaody Archipelago included. It is implied that the World Government receives bribes in exchange for ignoring the slave trade. The World Nobles practice slavery, using wanted pirates as "pets", other people and races as servants and trophies. To mark them as slaves, the Celestial Dragons mark them with the symbol called "The Hoof of the Soaring Dragon" (天駆ける竜の蹄,Ama Kakeru Ryū no Hizume?, FUNimation subs translate this as the Claw of the Celestial Dragons), forever marking them as "less than human".
Many slaves were once infamous people. Some have bounties of more than 50,000,000 and some are just wanted by buyers because of their species.
Aside from the World Nobles, other people can also own slaves, if they were to buy it at certain auction houses that are (secretly) authorized by the World Government. Such an example can be Tequila Wolf, where they forced many slaves to build a bridge for 700 years.
Unfortunately, the fact that no one can harm a Celestial Dragon or stand up to them means that no one can help a slave in need, or else they would risk certain death; however, some brave people, like Fisher Tiger or Monkey D. Luffy, may be immune to the intimidation. Aside from the "Hoof of the Soaring Dragon", the slaves also wear a Bomb Collar around their necks. If the prisoner attempts to escape from the Celestial Dragons, the collar explodes, heavily injuring (if not directly killing) the slave.
The bomb collar is a device strapped around the neck of slaves. They are connected to a chain, which, if broken, will cause the collar to explode. Their purpose is to prevent slaves from attempting to escape, and only the key or a highly skilled person is able to unlock it. It first appeared in Chapter 497 and Episode 391, the collar being on Dias.
The Shichibukai, Donquixote Doflamingo, owned the Auction House, before handing it over to a subordinate, Disco. To hide the fact that slavery still exists, the door to the Auction house has been labeled "Public Employment Security Office".
There is also a list of how much a slave can sell for, depending on what kind of slave the person is. The current selling price as seen within the series is as follows:
Sabaody Archipelago is a place where slavery is heavily enforced by sellers. Another known location is Tequila Wolf, where slaves were forced to build a bridge that connects the islands in the East Blue. It had been under construction for over 700 years, but was still incomplete due to the scale of the work involved, and may remain like that after all the slaves are freed by the revolutionaries. Also, Nico Robin was the newest slave there, after being teleported there by Bartholomew Kuma, and was only a slave for a short period of time.
It is unclear when slavery started, but it has been going on for more than seven hundred years because the people of Tequila Wolf had been building the bridge for seven hundred years. So far appearing to start just after the World Government took control.
Robin told Nami that slavery was a fearful pastime of humans, reminding people at present times how fearful and cruel people were in the old days. Also, Boa Hancock and her sisters were once slaves of the World Nobles, and they suffered plenty.
Eight hundreds ago, the Donquixote Family used the dwarves of the Tontatta Kingdom for slave labor for their strength and gullibility. After the family left for Mariejois, the first king of the Riku Family made amends for the dwarves for the horrible treatment the preceding family had caused by granting them rights to take whatever resources they please. Upon Donquixote Doflamingo ousting the Riku Family and retaking the throne in his family's name, he reestablished his clan's practice of using dwarves for slavery.
Boa Hancock told Luffy the story of Fisher Tiger, who broke into Mariejois and freed hundreds of slaves from the Celestial Dragons. He, being a fishman, took many fishmen and formed the Sun Pirates, with Jinbe and Arlong included. Fisher then took the symbols of the Celestial Dragons that was marked on the Fishmen and transformed them into a symbol of the Sun Pirates, a sun. With the symbol modified, the Marines did not have evidence of who is a liberated slave.
After the timeskip, the Human Auctioning House has fallen into disarray and its owner, Disco, is now a vagrant. Although as easily surmised and then directly stated by Caribou, the slave trade lives on implying that this is not the only auction house.
Slavery was a huge trade during the real world's own Pirate Age. The slaves were often of African origins and had travelled across sea in appauling conditions with many dying along the way. The ones that survived the journey often went onto live a life of misery and abuse, sometimes in conditions not much better then the ones they travelled across the sea in. The branding of slaves with the owners mark was practice in the real world. Just as in the One Piece storyline, in many cases were no longer considered human beings.
Those slaves who ended up being sold often tried to escape; slave owners over time turned to putting traps around the edge of their property to prevent the slaves leaving, much as the exploding collar on the One Piece slaves serves this same purpose. The slaves lucky enough to escape were unable to return home and escaping slavery was also a risky situation; when caught by the authourities, if they were not returned to their masters they may have even have been put to death for escaping their master. Those that were returned to their masters often faced serious punishment, usually by beating, at times the punishment was so brutal that it may have even led to the slaves death. In the One Piece storyline, such a thing was seen with the Sunny Pirates, where the Marines attacked Fisher Tiger demanding that he return the slaves he stole, even though it was impossible to tell who was a slave anymore.
As pirate crews raided ships at sea, it was not uncommon for those crews to come across slave ships. Some crews gave the slaves a chance to join the crew, these slaves often took up the offer as the life of a pirate was more often than not a better lifestyle than that of a slave. The slaves were often very thankful for their freedom and very loyal to the crews they joined. The recruitment of slaves into a pirate crew also led to a number of crews being multi-racial. In One Piece, Fisher Tiger himself was not against the idea of taking Koala on board his ship or returning her to her home island and even burned the "mark of the sun" onto her back, despite being a human. The crew itself consisted mostly of fishmen, but at least one merman was also known to be on board with the crew.