When you've been working like a house elf (crazilly hard) and are done for the day. You are free. Master can represent professors or bosses, and Dobby represents the overworked person talking.
The phrase is from Chamber of Secrets by JK Rowling.
Chris: Are you done classes today?
Trudy: Yeah, I'm free. Master gave Dobby a sock.
by True_L September 7, 2005