A lot of the local musicians around here are talking about forming a local music mafia to bring the heat down on these folks playing for free/exposure. Might be time to knock some heads like in the old days.
(I kid, but we are all pretty frustrated because it keeps the pay down for everyone else)
This depends greatly on the venue and the band.
For example, I play every week or so in a little band of shifting personnel, playing trad jazz (think 1920s -1930s), on the sidewalk outside a grocery store that's owned by the piano player. I can positively tell you that there will be free music, or there won't be any music there at all. Should we hold out for union scale and be told "don't let the door hit ya where the Good Lord split ya"?
On the other hand, if I get a call for a rock and roll dance band in a nightclub, where people are drinking and dancing and paying for it, I would expect to get paid at least the local market going rate.
This idea that the union goons should knock heads on anyone that plays without getting paid, or getting paid union scale, is a fantasy dating from a bygone time when there was an insatiable appetite in the United States for dance music, and mechanical reproduction wasn't good enough to supply said music, and there weren't 50 other entertainment opportunities. In 1940 in Ogallala, Neb., if you were young and single and wanted to go on a date, you had two choices - go see the movie at the local theater, or go to the dance at the American Legion hall. And it was that way in thousands and thousands of small towns and small cities all over the US. With that much work to be had for dance musicians, it was actually possible to hold out for better pay (at least, some times).
Well, I have bad news for you. That was 84 years ago. The world has changed just a wee bit.