If you are genuinely spying for business reasons then this is not illegal but you'll need to tread carefully about how you do things - for starters you'll need to have formally warned employees of possible illegal activities, prior to doing any follow-up checks. Also i would recommend using proprietry software rather than "hacking" with software you write yourself.
What you use depends again on what you want to spy on, for example checking an employee's internet history can be done via a firewall logging system, monitoring an employee's application usage (i.e. running non-authorised applications, games etc...) can be monitored via various software applications - checkout altavista for more details (we use "Monactive Pro" here as an example of one)
Mobius1 i don't know what you're on about but i suggest you read up on DHCP if that's what you mean - IP addresses last for at lot more than 1 day, unless this is stipulated at the DHCP server, even then they are usually allocated the same address as long as it's not been previously allocated out to another machine