It can, but it's informal. You'd ask that from someone with whom you're on a first name basis.
Not capitalising ön and önök can be seen as a sign of disrespect, but it's not incorrect grammatically.
I think it is the new fashion to capitalize "Ön", "Te", and derived words. There is no grammatical base for this, as far as I know.
New fashion ≠ incorrect
"Ms" as a title wasn't very popular until the 20th century, but now it is unmistakably a correct form.
Ön is supposed to be formal, so imagine asking this question to a stranger or to someone whom you want to impress or show respect to. A better translation of "You're a teacher?" would be "Tanár vagy?".