This might be true for the employer, but for the employee, I think there could be serious issues. For example, my present employer would be very unhappy if I agreed to this and I have no idea how it would play out. I'm almost positive it is in violation of my present employment contract.
Did the candidate that went for it actually have full time employment? If so, did they get approval first?
Our time limit of 20 hours or less, also helps. The hours could be spread over many weeks if needed to ensure there wasn't a conflict.
That said, it's not unheard of that some employees have more strict contracts such as yourself and we certainly would have had to pass on those candidates or find another way to evaluate them.
We also had the luxury of being a fully distributed team (pre-covid), so collaboration could happen during the candidates off hours, with a team member that was working.