Health and safety requirements. If testing and contact tracing isn't properly done it can be a problem, but as you said is it worse than black market conditions

Health and safety requirements. If testing and contact tracing isn't properly done it can be a problem, but as you said is it worse than black market conditions with zero oversight and safety stands? Probably not. The real risk is a lack of health insurance, retirement benefits, and taxable wage by allowing the black market conditions to exist. From a problematic standpoint is the "hostile work environment" claims if sex workers become legitimate.