That is the thermal overload button that is usually a part of the upper thermostat. They are set to shut off the power to a water heater when the temp reaches about 180 degrees. It usually is a problem with a thermostat sticking in the on position. The easiest way to check a thermostat is with the thermostat in place and with the tank hot. First turn off the power to the water heater and then go through the full range of adjustment on the temprature scale of the thermostat. If the thermostat is good you should hear or at least feel a “click” at some point on the dial(note:some manufacturers use a thermostat that has no adjustment). Check the lower thermostat the same way. The tank must be fully heated for this to work.If you have a continuity tester or ohms meter they will help in the test. Another old trick is to take out the thermostat and set it to its lowest setting and heat the underside with a lighter or a match. Also the adjusment screw should turn smoothly and with a slight tension. If it feels loose or rough when you turn it, it is probably a faulty unit. Note also that the thermostat bracket should hold the thermostat tight against the tank and that there should be insulation to cover the thermostat and the cover plate should not be missing. I have seen that missing cover plates and insulation can cause inaccurate temprature results. Hope this helps a little!