Why are their hands around their chest?
This pose indicates that they represent the dead and served to identify them with the god Osiris, the king of the afterlife. The is referred to by Egyptologists as mummiform--mummy shaped--or, especially in the case of a king, Osiride--Osiris-like.
Shabties like these would be placed in the tomb. They're essentially servants to the deceased, who would perform tasks like farming for them in the afterlife.
Is he holding a crook and flail?
This type of figurine, known as a shabty, typically holds agricultural tools. You'll only see kings and the god Osiris holding a crook and flail. Shabties are meant to come alive in the afterlife to assist the deceased with essential tasks like farming.
Tell me more.
These figurines were inscribed to the person they were buried with and were thought to come to life in order to help with chores, especially agricultural tasks.
They came in a wide range of qualities, from customized and individualized (the most expensive) to mold made and mass produced.