Taco Bell's old slogan "Run for the border" seemed the opposite of what it required it's employees to do--stay on the premises during lunch breaks if they bought discounted food. Employees complained, saying if they were to stay at the restaurant, they were entitled to pay because they weren't actually relieved of duties.
Taco Ball countered that, indeed, employees were free to leave the restaurant during their breaks--they only had to stay and consume any discounted food they purchased in the restaurant. Taco Bell wanted to ensure they weren't using their employee discount to feed friends or family members. If employees purchased food at full price, or didn't buy food, they were welcome to leave.
The 9th Circuit Court agreed with Taco Bell. They wrote:
"The panel held that California law was not violated because Taco Bell relieved their employees of all duties during the meal break period and exercised no control over their activities, where employees were free to use the thirty minutes in any way they wished, subject only to the restriction that if they purchased a discounted meal, they had to eat in the restaurant. The panel rejected plaintiff's contention that employees were under sufficient employer control to render the time compensable. The panel also rejected plaintiff's assertion that the value of the discounted meals be added to the regular rate of pay for overtime purposes."
Are you required to give breaks?
From a federal law perspective, no. Most jobs don't require breaks or have a cap on the hours worked. (Transportation jobs, for instance, are different, and we are not discussing those.) But state laws vary, and many require breaks. Teenagers are often under different rules regarding breaks. Please check your state laws to make sure you are in compliance.
When do you have to pay for a break?
If a break is for less than 20 minutes, you're required to pay your employees for that time. That means that bathroom trips and coffee breaks are almost always compensable time. You can, of course, forbid coffee breaks, but don't think about forbidding bathroom breaks.
While there is not a specific federal law that requires companies to provide bathroom breaks, OSHA makes it clear that employees need bathroom breaks. The OSHA Education Center (which is not a government department, but a private company specializing in OSHA) states:
"Employers may not impose unreasonable restrictions on the facilities' use, and employees should not take an excessive amount of time for bathroom use and notify another employee of his or her absence when appropriate. Due to the varying nature of bathroom necessity, no specific regulations exist."
In other words, don't be a jerk. If your employee needs to go to the bathroom, let him go. If an employee has a disability that requires more bathroom breaks, let him take more bathroom breaks.
Exempt employees get all breaks paid.
If your employees are exempt from overtime, then their paychecks must remain the same from pay period to pay period, no matter how long they work. If an exempt employee goes out to lunch and is gone for three hours, you can fire him for being a slacker or dock his PTO, but you still have to pay him for the full day.