Are employers in North America legally allowed to monitor employee's internet mail such as yahoo, AOL, hotmail?

I am wondering about the legality of this issue.

If the email is sent from or received by a computer owned by the employer over an internet connection paid by the employer, very probably yes. In our state, definitely yes, unless the employer's policies or (if there is one) the collective bargaining agreement say otherwise.

If you are accessing it through a company computer, phone, PDA, or any other type of company asset then in 99% of all cases yes the employer is legally allowed to monitor anything sent by you or received and accessed by you. The same goes for you using your personal computer/equipment but connecting to the internet via a company internet connection.

My former employer would not even allow us to access the internet, and they had a computer czar in HQ that monitored e-mails on their LAN system. So if I had a boss that would just let me get online while at work I would be happy...

Yea, the computer and/or internet connection is their property. Any smart company will forbid use of outside e-mail/IM services to minimize risk.

If the employees are on company time on company computers then the answer is yes...... also when you post something in places like U-Tube and your employers sees it he can use it against you even if it has nothing to do with the company.

Use it against you how?

what about you have your own laptop with its own internet access? is the laptop connection strictly own by you?

Employers are now checking sites such as "My Space" to judge prospective new hires.

They are also looking at these same sites in regards to their present employees. It's amazing the things they have learned about some of their long term trusted employees (rants against the company, company personnel, supervisors, admissions of theft, etc).

And yes, it is all legal when company property is being used and the MySpace type of websites are in the public domain because they are publicly posted.

They can't monitor that but should forbid anyone from using it for company work and may forbid you from using it while on their time. It all comes down to risk. If I'm in charge of a company network there is no way for me to know if someone's home PC has a virus/worm/whatever that could affect my network. Then there is the legal liability should someone you have offended trace your e-mail back though the company network. Even if as you said you have personal equipment at work with your own connection there is the abuse of company time when your checking your personal accounts on the company $. Then there are issues where someone else doesn't like the company and sends spam out faking your e-mail address and the company has to prove that it didn't come from them and in the process finds mail from you on your own equipment and now you have to prove you didn't send the spam. Then there is the potential for the disgruntled employee to steal company secrets when he finds out he is getting laid off.