Astraeus has been doing this for at least the past three years. I fly with an ex-Astraeus skipper who stated it felt a bit odd with guy sitting next to him as the f/o who was both a colleague and a customer.
I think it is wrong. However, what do people think about the CTC scheme which places F/Os at the hands of EasyJet and others who are not paid for the first 6 months. This has the same effect on T&Cs but for some reason, people seem to think this is an OK state of affairs.