The ICO’s research found that almost 19% of people think they have been monitored by an employer.
Meanwhile, only 19% of people would feel comfortable taking a new job if they knew that their employer would be monitoring them.
Emily Keaney, deputy commissioner of regulatory Policy at the ICO said: “Our research shows that today’s workforce is concerned about monitoring, particularly with the rise of flexible working. Nobody wants to feel like their privacy is at risk, especially in their own home.
“As the data protection regulator, we want to remind organisations that business interests must never be prioritised over the privacy of their workers.”
Monitoring can include tracking calls, messages and keystrokes, taking screenshots, webcam footage or audio recordings, or using specialist monitoring software to track activity.
The new guidance outlines legal requirements in monitoring and advice on how to build trust with workers and respect their right to privacy.
This includes telling workers about any monitoring in a way that is easy to understand and using monitoring for a clearly defined purpose in the least intrusive way possible.
The guidance states employers should also only keep information that is relevant and carry out a data protection impact assessment for any monitoring that is likely to result in a high risk to the rights of workers.
If employers are not transparent and fair when monitoring employees, they will lose their trust, according to Ian Moore, managing director of HR support Lodge Court.
He told HR magazine: "While monitoring staff might seem like a way to increase productivity by discouraging long breaks and social media usage, it can actually have the opposite effect.
“Invading employee privacy can lead to higher stress levels, lower engagement, and even legal issues. Excessive monitoring can also breed mistrust, as employees may feel that they are not trusted to do their work without constant oversight.”
Matt Creagh, employment rights policy officer at the Trades Union Congress, said since the rise of working from home, some employers feel tempted to monitor employees more.
Speaking to HR magazine, he said: “Workplace monitoring and surveillance can be intrusive and infringe the private lives of working people and their families especially when they are working from home.
“Workers and unions must be properly consulted on the use of workplace monitoring and surveillance.”
He added that surveillance can play a role in keeping workers safe, but employers must be held to high standards.
"New surveillance technologies can play an important role in making sure workers can be kept safe at work. But if used improperly monitoring can really undermine trust and confidence between staff and their employer.
“Trade unions can ensure that safeguards are in place to protect the health and wellbeing of working people and that intrusive surveillance methods aren’t used to cause workers ill health and undue stress."