Yes, hold the presses - governments pass employment laws that affect private companies.  They've been doing it since before 1867.

Third parties (adjudicators and judges) have been having an affect on how businesses are run for quite a few years, too.

And by the way, "converting employees to contractors" means giving up a considerable degree of control over how they do their work.  If not, they're still employees no matter what you call them.