Depending on the working conditions at your jobsite, your boss may have the right to keep tabs on what you're doing on the Internet on work computers during work hours.
There have been cases of employees speaking to outsiders using instant messenger programs about inside knowledge for the company, and employers have been deemed in their rightful place to snoop through those messages, which were later used as evidence to fire the employee breaking the rules.
Although you feel in your right to have privacy in your workplace, so long as you're using work equipment and fooling around during work hours, everything you do may turn to your employer's favor.
Recent studies show that this kind of impression stresses out work employees and makes it more likely that they'll make mistakes based on the feeling that they're being spied on. Feeling like they have no privacy hinders productivity and makes them question every move they make more often.