We get lots of calls regarding this question and the answer is sometimes. Video surveillance laws vary from state to state, but in California it is legal in the workplace under certain circumstances.
California's Constitution provides residents with a right to privacy and the California Labor Code specifically prohibits certain areas from being recorded, including bathrooms, locker rooms, or any other type of room where the purpose is to change clothing.
Moreover, under the National Labor Relations Act, union meetings and activities are also prohibited from being recorded in any way. Surveillance video also may not be used in any way that could intimidate employees who could become union members.
Outside of these exceptions, employers may monitor their employees if there exists a legitimate business reason that outweighs an individual's privacy interest. For example, employers are generally allowed to use workplace surveillance to prevent internal theft or for general security purposes, as long as the employees are aware of the video surveillance. Further, because California is a two-party consent state, the surveillance may only include audio recording if the employee provides explicit consent.
Ultimately, employers may monitor their employees in some cases, but must do so lawfully. If you believe your right to privacy is being violated, or you are terminated for reporting your employer's unlawful surveillance, an attorney may be able to help.