Legally speaking, isn't it a violation of an individual employee's privacy to archive their email?

In the U.S., there should be no assumption or expectation of privacy by the employee when using the company's email system. Most companies, that I know of, will display the company's email policy when signing onto the company email system for the first time. This normally includes notes that remind users that the email system is a company asset, to be used for business purposes only, there is no assumption of privacy, etc. There are numerous U.S. legal precedents that side with the employer in such matters.

Email archiving information Choosing an email archiving strategy Email retention policy: A step-by-step approach  Archiving unstructured data

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