Benefits are easy: don't offer them, or make sure you structure the work week so the employee doesn't get enough hours to qualify.

People deal with unplanned for interactions with people better than a machine, they're much more flexible.

Liability, you can go either way on that.

I think it's an open question still, when you get down to low enough skill and pay.

Edit: People are the ultimate low skilled contingent worker. A pre-programmed AI-equivalent in every box.