kohai , n. (koh-hi) meaning junior, and senpai , n. (sen-pie) meaning senior.
If these terms were to be compared with a college or university setting, Senpai would be upperclassmen and Kohai would be lowerclassmen. In Japan, the Senpai is someone who is supposed to look after the Kohai, to assist and support the lowerclassman, and to lend a sympathetic ear and be someone they can rely on. Senpai is often used as a term of endearment. The Kohai does not serve the Senpai.
In the dojo, the Senpai usually are seated in the most senior positions during training and are important to the culture of the training environment in their roles as leaders. Senpai students ought to be the best examples for newer and less experienced students, they may be called to assist the instructor in demonstrating the application of technique. Kohai students just have to be observant, learn and do their best.
Unfortunately in some karate dojos, some brutal school club activities surround this relationship. In both Japan and in North America, the Kohai is made to feel as a slave to the Senpai. This kind of arrangement is unacceptable and should not be happening in your karate dojo. The best karate schools in fact are quite insistent that higher ranked students have a responsibility to their lower ranked classmates.
In terms of proper etiquette, one is called “Senpai” by others, and does not refer to himself as a “Senpai”. If someone says, “I am your Senpai!”, it is just like saying “I am your Master!”.
If your dojo has a master-slave relationship between Senpai and Kohai, then they have it all backwards, and you should get out of there. The Senpai are there to support the Kohai. They help them, and do whatever they can to encourage them towards improving their karate.