Pornography is illegal. One doesn't want to use the term "pornography" when disciplining an employee unless one can prove it. Otherwise, a big lawsuit may result.
What one can do is discipline employees for downloading workplace-inappropriate materials. That indicates a lapse in judgment, not a moral failure - and it doesn't present any problems in regard to this legislation.
If someone is not downloading dirty pictures, but actually is downloading porn - which is pretty much limited to pedophilia or bestiality imagery (don't know why images are porn online but text isn't, but that's the law), one probably ought to handle it as a criminal matter, rather than as a human resources problem.