Montioring employees at work is a very grey area, legally speaking.
Many companies have problems when they put security cameras in for business reasons (for example, in retail shops for watching shoppers on CCTV) but then use that footage to monitor employee performance. The bottom line is with your dads situation, its their item so they can do what they like. However, they really should tell employees that they are doing this and why.
However, with all that said I also think you need to make sure your dad and his colleagues have their facts straight when they talk about what this tracker is actually for.
A lot of cars have trackers fitted to them for security purposes - mine does. However, this isn't some GPS thing thats always on so that I or my other half only need look at a radar screen at any given moment to see where the car is. It's a security measure so that if the car is stolen, you call the tracker company and they switch on the device to find out where the car is at that given moment. Cars are after all quite expensive so its only natural that a company would want to protect its assets as much as possible.
Although the James Bond idea of having lots of little dots on a radar screen is possible, its no doubt quite expensive to maintain. As bloodycheap suggests, he should speak to his company to clairfy what the situation actually is and how the devices will be used.