This is nothing new. That's been the situation for many years.
What to do about it is very different. If your employer decides not to offer your the benefits of an employee - holiday pay, for example - are you really going to kick up a fuss? It's a very small industry.....
I am generally anti-unions, and have been since I've been old enough to make up my mind. But this is one area where a union like BALPA is probably the only way of making progress. Unfortunately, I don't think many instructors are members of BALPA (I know I'm not), and I think unions are more likely to be succesful in changing practices at one large employer, rather than at many small employers as is the case with flying schools.
From my own point of view, though, I knew the score before I made the decision to get into the industry. My current employer has never offered me the benefits which an employee is entitled to, but because I never expected them everyone is happy.
FFF
--------------