It is not common, but I do it for various projects, and have also worked part time for others. On the hiring side, the projects are in maintenance mode and there just isn't 40 hours of work a week, esp. if you split (say) front end and backend. I also do PM consulting, and can manage a number of developers working only a few hours a day.

You have problems if you hire people who are not professional freelancers, or those who can't manage their time. I once broke that rule and hired someone with a full time job. They were pressured into OT at work, quality on my stuff dropped like a rock, and he was grateful to be fired. So unless you're a full time freelancer, I won't hire you. Others might, though!