yes,debatable,no
Depending on the network setup, they probably can. as to weather they are moraly or legally allowed to is debatable, after all, its not YOR pc, its the companies, and somewhere in your contract I bet theres a clause stating that its their equipment and they own whatevers on it. As for stopping them, not a chance (assuming the admins know what they are doing)
If they squeeze olives to get olive oil, how do they get baby oil?