To be legal, he's going to have to get the xp home upgrade disk.

If I were you, I'd just tell it to him straight, you want to upgrade, fine, buy the upgrade, you want to reinstall all your apps or pay me to do it, fine, I'll wipe the drive and install your oem disk.

When it comes to software legalities at work, don't bother trying to bend the rules, it aint worth the risks involved if you ever get busted.