The TUC said employers were using hidden cameras and tracking devices to monitor staff and routinely checked their workers' e-mails and phonecalls.
Examples included hidden cameras in a hospital staff room and one in a room at a security firm where staff changed.
'Snooping' was bad for productivity and workers' health but likely to rise as technologies got cheaper, the TUC said.
General Secretary Brendan Barber said: "Big Brother bosses do not get the best out of employees. Staff who are being snooped on are less productive and less healthy. "There has been an unregulated boom in the intrusive and ineffective drug, drink and health testing of employees."
The TUC said workers should only be tested for drink and drugs when "absolutely necessary" and is calling for the Employment Practices Data Protection Code, which covers such tests, to be tightened up.
"Technological advances, particularly in the fields of power supply and miniaturisation, mean that it's now possible to bug almost anywhere and anything". (Charles Shoebridge, former counter-terrorism intelligence officer)
However, CBI legal adviser Susannah Haan said bosses must be allowed to monitor how their systems were being used.
"Unfortunately there is a minority of staff that abuses company trust. The majority of company fraud is committed internally and over 40% of firms have had to dismiss staff for e-mail or internet misuse," she said.
"Of course firms must be sensitive to employee privacy but they must also be able to monitor the use of their own systems and discipline those who misuse them." BBC News