A group representing aged care providers says the sector faces a crisis if employers lose legal action over low pay.
Unions have begun legal proceedings under the Equal Pay Act against six companies, arguing that low wages in a mostly women-dominated workforce equates to gender discrimination.
The Service and Food Workers Union and the New Zealand Nurses Organisation say they have started the action after the initial success of a Lower Hutt careworker.
Kristine Bartlett argued that the low pay of women in aged care is gender discrimination. The Employment Court issued a preliminary finding in favour of the claim and the case now awaits a Court of Appeal hearing in February next year.
Organisations facing legal action include Metlifecare and Ryman Healthcare, which are part of the New Zealand Aged Care Association.
Association chief executive Martin Taylor said the companies would like to pay their employees more, but can't afford to.
Mr Taylor said if legal action goes in the unions' favour, and caregivers wages are forcibly increased without any extra Government funding, the sector will struggle and some providers will fail.
"Straightaway you would find that a considerable part of the sector would be insolvent and then the other part of the sector would be very worried about their solvencies."