The National Council for Voluntary Organisations, the care membership body Care UK and Leonard Cheshire Disability have expressed concern about a European Court of Justice ruling that care staff should be paid for travelling time to and from work.
The court ruled that non-office-based workers such as care assistants, sales representatives and tradespeople should be able to count their journeys to and from their first and last jobs of the day as work, and be paid accordingly.
The move comes after an announcement by the Chancellor of the Exchequer in July of a new national living wage, to be introduced in April – it will rise to about £9 an hour by 2020.
Michael Birtwistle, senior policy officer at the NCVO, said: "The care sector in particular will already be under pressure as the new national living wage kicks in.
"This could present an extra burden, and charities and commissioners will need to be mindful of it in designing and pricing contracts.
"Charities will want to treat their staff well. However, if they have to abandon unsustainable contracts, we could see a decline in the diversity of providers in the care sector."
In addition to having to pay hourly workers for extra time, the ruling could mean care charities that employ home care assistants will fall foul of minimum wage rules, if the time added on to a salaried worker’s day meant their hourly pay dropped below the legal minimum, employment experts said.
Work patterns might also have to be reconsidered if the extra time meant that employees who were asked to work more than the European Work Time Directive maximum of 48 hours a week. They might have to be given extra breaks to fulfil their right to a 20-minute break every six hours.
Martin Green, chief executive of Care UK, said the ruling would have a "big impact on charities that deliver community services".
Combined with the living wage announcement, he said the ruling would place "further unfunded cost burdens on charities that are working hard to provide services to people who need help and support in order to live good lives".
Andy Cole, campaigns director at Leonard Cheshire Disability, said the organisation was "considering the implications" of the judgement for its own staff.
"However, together with the national living wage, it will increase the financial challenges facing all care providers as council budgets are stretched even further," he said.
"We are confident the Chancellor will address the funding for social care in the forthcoming Comprehensive Spending Review."