Very, very good. It shows the kind of trust in employees that I like to see. Depends a bit on how they will interpret "As long as the work isn’t related to GitHub’s own “existing or prospective” products and services" but I'd assume that it will be very reasonable.
I'm sure this is all idealistic crap, but I'd still love to see someone try it; I'd like to see a well grounded company include "even if it is related to <company>'s own existing and prospective products". A nice competitive taunt "Go ahead, try and compete with us, we dare you." Code is already covered by copyright, so it's not like anyone could take the repository and start a GitHub with it. Even if they could, not many people are going to trust the new fork because it's future is not backed by the same team and community (unless the existing team and community has become toxic, but, ideally, having this threat in place could prevent that from happening in the first place). Code is only part of GitHub's success, recreating the other parts isn't going to happen easily. No single person could know all the ins-and-outs of every important role in the company.
Kudos, great decision.