What do employers do about tax withholding?
If they are using a fraudulent SS#, same procedure as always.
The IRS and SS both know that millions of numbers are used fraudulently and does not notify the actual SS# holder.
They sometimes send the employer a “no match” letter.
The employee provides another fraudulent number and the dance begins again.
Lots of subcontractors pay cash and do not bother with taxes, worker’s comp., insurance, etc.