Law & Taxation mentor Richard S. Morse Jr. responds: As a general rule, companies have the legal right to monitor employees' e-mail. The rationale for this is that an employee who sends or receives e-mail at work is using company resources and facilities.
The best practice for the employer is to develop a written policy regarding not only monitoring of e-mail but also employee use of company computing and telecommunications resources and facilities. If the company intends to monitor e-mail -- or needs to be reasonably confident that it can monitor without liability if it decides to do so -- the policy should state that employees have no expectation of privacy in e-mails sent or received at work.
Of course, whether or not a company has a written policy, scenarios can be imagined in which monitoring might be done abusively enough to result in liability. In general, employees should not commit to e-mail anything they would not want others in the company to see.