Most employers do not mind a little internet surfing or msn’ing during the work day but there are limits to everything, so it seems reasonable that an employer can look at someone’s browing history on any given day. But it’s easy in IE7 to delete browsing history, forms, etc under the tools menu.
To prevent browing history from being deleted you can create or edit group policy objects. This should only be done by staff with advanced IT skills or your IT Administrator.
Settings are located in both Computer Configuration\administrative Templates\Windows Components\Internet Explorer\ and User Configuration\Administrative Templates\Windows Components\Internet Explorer