The case revolved around a Romanian engineer who was fired in 2007 after his company discovered he was using Yahoo Messenger to chat not only with his professional contacts but also with his fiancee and brother.
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Company policy prohibited the use of the messaging for personal purposes.
The European Court of Human Rights (ECHR) in the French city dismissed the engineer's argument that the company had violated his right to confidential correspondence.
The court said it was not "unreasonable that an employer would want to verify that employees were completing their professional tasks during working hours," adding that the company had accessed the messages in the belief they contained professional communications.
The judges also defended the decision by Romania's courts to allow transcripts of the engineer's communications be used against him in court, saying "it proved that he had used the company's computer for his own private purposes during working hours".
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By withholding the identities of the people with whom he had communicated, Romania's courts struck a "fair balance" between respect for privacy and the interests of the employer, the Strasbourg court ruled.
The ECHR's judgements are binding on countries that have ratified the European Convention on Human Rights.
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