I appreciate and largely agree with what you've said, but I think you're neglecting a context where there's an NDA or similar involved, which is what I assumed was meant by "even vaguely sensitive". As far as I know, there's no legitimacy to someone who's signed an NDA somehow sublicensing that NDA without the explicit approval of the issuer of the original agreement.
That's entirely true about NDAs, but then are you really hiring a contractor or just misclassifying full time employees so you're off the hook with employment law?
