I honestly believe it's not really the "companies" that are the problem as such, alienating your staff isn't good for the long term health of the company - if they were run properly these sort of things wouldn't happen. What it is good for is a short-term boost for the reputation of a particular manager. It doesn't matter that it costs the company more in the long term, all that matters is that within the accounting time-frame the negative effects are not reported. Once the negative effects start to become apparent, the manager can escalate this, get some extra budget to invest in people and tell the board "look how good I am, I spotted this problem early and took appropriate action to sort it before it became a problem". Then rinse and repeat.
Tbh I think the law is pretty good and fair to both employer and employee for the most part, the problem is that there's no real employee rights watchdog - all the power is with the employer and they know it. We can see a good example in this thread, where the OP works seven days consecutively (illegal) because no doubt he was led to believe that was expected of him without explicitly saying so, and then the company turn round and say the seventh day wasn't authorised so he won't get paid for it ensuring that the company have complied with the letter of the law if not the spirit.