Is it legal for a US company to monitor all computer and Internet usage of its employees (while using company-owned computers and internet connection)?

Technology now makes it possible for employers to keep track of virtually all workplace communications by any employee, on the phone and in cyberspace. And many employers take advantage of these tracking devices: A survey of more than 700 companies by the Society for Human Resource Management (SHRM) found that almost three-quarters of the companies monitor their workers' use of the Internet and check employee email, and more than half review employee phone calls.

According to a study by the American Management Association, businesses offering financial services -- such as banks, brokerage houses, insurance firms, and real estate companies -- are most likely to monitor employee communications.

Employers have a legitimate interest in keeping track of how their employees spend their work hours. After all, no one wants workers surfing X-rated websites, sending offensive email, or calling in bets on the ponies on the company's dime. And employers may want to take steps to make sure employees are not giving trade secrets to competitors, engaging in illegal conduct at work, or using company communications equipment to harass their coworkers.

Employers are allowed to monitor their employees' communications, within reasonable limits. But employers must make sure that their monitoring does not violate their workers' privacy rights. And, on a practical level, employers must decide how much monitoring is necessary to serve their legitimate interests without making their employees feel unduly scrutinized.