I don't understand why this is even remotely controversial. I am as jealous a guard of my personal privacy as anyone, but I would expect my employer to be able to monitor my work-related email. The resolution is simple: conduct your personal correspondence through a separate email account that is not owned by your employer.
In fact, I keep strictly segregated work and personal email, and I run my own company!
And I expect my employer to leave all my communication unmonitored, be it e-mail, snail mail or private face-to-face discussions. Here, controversy created.
That's what the law says in Finland. Also, I personally believe the confidentiality of communication should never depend on the used medium or the ownership of the equipment used for the communication.
It's not about the ownership of the equipment, it's about whether the communications are official actions performed by an employee on behalf of the company. If they are, then the employer obviously (IMHO) has a right to know about them. And the best way to keep things from getting complicated (again IMHO) is to segregate work email (which the employer can read) from personal email (which no one but the user can read) in separate accounts.
I really don't see how any reasonable person could disagree with that.
In fact, I keep strictly segregated work and personal email, and I run my own company!