Well - nearly everyone in the industry is using some contracts like that if you are nowadays still stupid enough to go for it. Especially the UK and Ireland are still encouraging this kind of system hence you are working for only one company, so you are actually an employee(no arguing about that - if you work for ONE employer then you are an employee).
My old outfit, one of the so called(by themself) market leader in biz aviation is offering this kind of fraud contracts as well. It will need a big effort by union and local authorities to stop this mass fraud. It is as simple as that.
@Rat: Not the union is encouraging that, it is the countries by themself. In mainland Europe it is not possible to do this kind of setup because the authorities would not accept your explaination. So I think the UK is responsible for that by having the wrong laws. Not the EU. But soon that will be over, you will be free again and everything will be perfect. Cynical? Damn right as well. Bye bye.