Is it legal for a restaurant employer hire waiters on 1099? What the employee can do to avoid the trick to pay taxes at the end of the year and report to IRS the abuse?

When you were hired were you told that is how you were going to get paid? (as an independent contractor) ?

And there is no "trick" you still pay taxes, they are just held out of your pay each week. On 1099 you do pay the other part of the Social Security taxes.

So when you are paid each week, just put that 20 or so percent in a savings account to have it to pay your taxes.
That is really what you do when you have it held out of your check.