I was headhunted by my current institution. The post was advertised, but the Dean contacted me to ask me to think about applying, and we had several meetings & conversations (I knew her from elsewhere). I applied as normal, but I was the only person they interviewed (high risk on their part, I thought).
So, I had to be clear in my own mind whether I wanted the job - it seemed to me to be unethical to interview & the turn it down. But I was clear that there were reasons for me to stay where I was at the time. So I had lots of questions for them.
I didn't tell my immediate departmental colleagues that I was being lured away - but I did speak to the PVC of of my then faculty - more or less to try to find out from him (a slippery character at the best of times) what my future and the future of my unit would be if I stayed. He offered me more money to stay, although I told him it really wasn't about the money. I felt my unit was being driven down & lacking in investment & care. In the end that was why I moved - I moved to a university which values the discipline I teach/research in a way that the place I left did not.
But the conversation did mean that I had a salary offer on the table to tell the headhunting institution. And they offered me what the place I was leaving was dangling at me (a payrise of around £10k, although the move was to a really expensive city & I need that extra salary).
The move hasn't been ideal location-wise to be honest - it's expensive & I'm less well off than where I was (north to south moves are awful that way). But the work, the institution & the team I work with are much better.
I tried to be as ethical & straightforward as I could - I didn't tell my immediate colleagues as I really was not sure about the advances being made to me, and if I decided not to leave, I didn't want them to know. However, I did consult with my Head of School as well as my PVC of Faculty - not to drive up my worth at that institution, but to be clear about what they saw me doing in the future with them, and how they were thinking about the development of my Department. They could give me assurances about a glittering future for me (I'd be a PVC by now if I'd stayed, but I'd already decided to step off that track) but not my unit - I'd have had to do that heart & back-breaking work.
In the end, it was the treatment of my unit that tipped the balance. I knew if I'd stayed I'd have had to lead the development of my unit, and fight every single step of the way. I suspect it may literally have made me ill.
So I allowed myself to be headhunted elsewhere. And on balance, it's been a very good move.
I think the one thing that I've noticed every time I've moved (and I like to move institutions every 10 years or so so I don't get stale), is that it takes a couple of years to establish yourself, get asked to do things, consulted etc. Even at my level (now reasonably senior prof), a move is always a bit of a backward step in the range of things I get asked to do. But after a couple of years, it picks up again. I'm as overcommitted as ever!
long story short: be clear about your own ethics and boundaries. And be straight with the people you're dealing with, while balancing that with discretion. Only you will know where the balance between openness and discretion is most comfortable for your conscience & your career.
I think on balance, I probably wasn't open enough with my immediate colleagues. But I needed to look after myself - and by this I mean, not career-wise, but my mental & physical health.