Employees at St Mungo’s will take part in a strike ballot from Monday following the collapse in talks between the charity and the trade union Unite over a dispute about staff terms and conditions.
Unite had claimed the charity was refusing to cancel plans to remove a junior staffing cap agreement and said it feared services would be harmed, because higher-paid experienced staff were being pushed out and replaced by lower-paid junior staff.
The union said it also had issues with the charity’s "draconian" sickness and disciplinary policies.
But the charity denied it was seeking to alter employee terms and conditions, or that staff would be made redundant.
The dispute led to almost two weeks of negotiations through the conciliation service Acas, but the talks collapsed on Friday 26 July.
As a result, Unite has confirmed it will ballot 500 of its members who work at the charity about strike action, with the ballot due to close on 9 September.
If the strike goes ahead, it would involve a third of the St Mungo’s workforce.
In a statement, Unite said it would also contact local councillors in London, Brighton and Bristol about the threat to jobs and what the alleged changes at St Mungo’s would mean for contracted homelessness services.
Tabusam Ahmed, regional officer at Unite, said that Unite would begin balloting its members with "deep regret".
Ahmed said: "Our members are deeply committed to the work they do – their first priority will always be the people they support. They genuinely fear that if St Mungo’s gets away with tearing up their trade union agreements and reinstating ‘race-to-the-bottom’ terms and conditions, the service will suffer.
"This strike ballot is about protecting the integrity and professionalism of our members’ jobs and the service provided to some of the country’s most vulnerable people.
"We regret that it has come to this but the ball is in St Mungo’s court."
Howard Sinclair, chief executive at St Mungo’s, said the charity was disappointed in Unite’s decision to ballot for industrial action.
"It is a disproportionate response, totally unnecessary and potentially very disruptive," he said.
"We have made clear to Unite officials that St Mungo’s is not proposing any changes to terms and conditions of existing staff. If Unite’s strike goes ahead St Mungo’s will do everything necessary to protect the interests of our clients."