According to the ABC Test, my entire visual effects career (15 years) was illegal.
this is... well, yeah, a surface reading of the test is clearly not how it legally plays out, 'cause from a surface reading, almost all "contract" jobs are not.
I think this is legally dealt with where I am by ensuring that everyone is an actual employee of someone... if you are a "contractor" you are actually an employee of the body shop. You get paid on a w2, and thus aren't legally a "contractor"
From what i see, the body shops charge the employer 30-50% more than what they pay the employee (the range depends entirely on how good the employee is at negotiating, and tends to start closer to 50%, and move towards 30% as said employee is in the same position for a while)
I mean, it's not that the contractor can't get paid less, it's that they can't be contractors at all, even if the employer claims so.
[1] https://www.law.cornell.edu/wex/abc_test