Sad reality is, if he doesn't take it, someone else will. The fact that your 'open to litigation' as you say should be reflected in your rewards but it's not and this shows the level of abuse out there. What's the harm in the firm wacking up a little contract for you, offering you a salary of say £5 per working hour? The money's not the issue here but other things. They are not treating you like a human if they cannot afford you basic employee rights. It's not difficult to do from their point of view, but you're right I wouldn't do it if I couldn't safeguard my interests.
Recruiters take note. Next time you ask someone why they didn't work as a 'Para' pilot or similar roles, consider these harsh but real facts. It's not because we wannabe's are not interested in steady progression, but we need to feed our mouths and sometimes the mouth of others, we need to pay bills, the rent etc. I know you don't care, but you should!