If only.
I know several people where HMRC have ben very aggressive in chasing tax revenue only to have it proved that they had made a mistake.
I know of one case where a builder was made bankrupt for £22k only to later have it proved that HMRC owed him almost £25k. They had no accountability for destroying the guys life because he couldn't find any legal team who would take on HMRC.
As for "However, as contractors, they are not entitled to the same holiday and sick pay benefits."
Surely by that test alone, they do not have the same conditions as salary staff so are not employees