HN user
It wasn't that they could log into any account they wanted (that would be much worse); it was that they could view any profile page they wanted, so it was essentially like an employee could become "friends" with a user, without the user knowing, and without the user's consent.
Throwaway because I learned this while NDAed (on-site interview for an internship over 4 years ago), but Facebook USED to allow employees universal profile access. I heard this from the recruiter who took all of us interviewees to lunch and showed us around, etc. - she said she had used it once to look up some dude she thought was creepy. I'm pretty sure they've since changed their policy. Not sure if OP was referring to Facebook or some other company, though.
Personally I'd argue that this isn't QUITE equivalent to giving employees access to all users' email accounts. That would be a better analogy if they were giving employees access to users' private messages.