Hi everyone, we have this new laundry tub installed, the inspector says in the report it's not correctly installed, the lip on top of the tub should be tucked in under the tiles on the wall. Since it's already installed, we are thinking what is the best way moving forward? I am a person with very limited knowledge in this field , so would really appreciate if you guys can give me some advice.

My questions are:
1, What is the correct way to install it? First install the tub on the wall then tile around the tub? (then inside the tub the wall will be un-tiled, this tub doesn't have a back. )
2, If that's the correct way, to correct the installation, we will need to remove tiles on the wall, put the tub in, then tile around it, will it be worth it (the contractor will need to do it, I sent them the inspection report but they didn't do anything)? will that damage the waterproof layer of the wall?
3, The potential risk if we leave it like this? The inspector mentioned something about water will get in the back, but I don't know what exactly that will cause.
Thanks in advance.