Are students allowed to read recommendation letters written for them?
Legally, in the USA, students are entitled to access their educational records.  (I assume that there are similar regulations in some other countries.)  This poses an obvious problem with letters of recommendation, the contents of which may ideally be unknown to their subjects; this makes it possible for the recommender to give completely honest evaluations and discourages students from "shopping" for the most positive references.

The solution is that students normally waive their right to view the recommendation letter.  Most colleges now have online recommendation systems for references to use, and there is always a prominent notice that the student has waived access to the letter.  I have never had to write a letter when this waiver was not in place.  I know a couple colleagues, however, who have gotten recommendation requests that did not include the waiver; their solution was to write a polite e-mail to the student, reminding the student to waive access.  (That the faculty involved would not be willing to write the letter without the waiver may or may not have been made explicit.)