If I work in food service and it gets hot but recently our employer told us that we are not alowwd to drink water unless we are on break, is this legal?

Each state has its own set of workplace safety rules, but OSHA is the federal agency responsible for workplace safety at the highest level.  If the working conditions are such that people will have issues with heat exhaustion or dehydration and the employer is intentionally withholding water, then the employees could file an OSHA complaint based on an unsafe work environment.  The good thing about an OSHA complaint is that it's free, can be done online, and it's confidential.... which is what most employees are looking for.  The more complaints they receive on an employer the more likely they are to respond more quickly. 

Another option is to file a lawsuit on behalf of the employees for injunctive relief-- however, this does tend to cost money and most employees tend to find themselves a "bullseye" after suing their employers for anything (not just workplace safety issues.)  That's why most used state and federal online reporting programs, like OSHA, to try to fix workplace issues.

Another option that builds in a type of safety net is through organized labor (i.e. unions).  Many people are not comfortable with unions, but since many employers have cut safety programs to improve their bottom line during the recession, it seems like unions are making a necessary comeback.  See if there is a union in your area that might come in and help the employees negotiate for better working conditions.  The safety net is that if the employer tries to harrass you after engaging in union actitivity, then you would have a very good retaliation suit.  The union may also have the resources to help you file a suit for either type of action described in this response.  If you do decide to hire an attorney to help you, find one that is familiar with employment law.  Employment law is a tedious overlap of statutes and administrative codes.  Failure to follow a code section to the letter can result in a waiver of valuable remedies.