LEGAL action could be launched against Wirral Council after a decision to axe 26 domestic care firms, putting thousands of jobs in jeopardy.
The authority decided to award contracts to six larger care firms, including Local Solutions, which has recently been investigated by a Government watchdog.
Many of the dropped companies now face going out of business and say the council ended their contracts in favour of "cheaper" labour.
Managers at more than 20 of the companies have formed a committee and have sought legal advice.
They have started a petition against the council's decision and want all the thousands of carers who will lose their jobs to sign it.
A spokesman for the newly-formed forum said: "It's a cost- cutting exercise. They say it is about quality but none of our companies have been investigated.
"My company has received two excellent inspection reports and we have spent a lot of money training our staff."
Wirral South MP Ben Chapman said he had already been contacted by constituents concerned about the proposed changes.
He said: "Whilst there is a duty on councils to obtain best value for council tax payers there is also clearly a duty to ensure some of our most elderly and disabled people receive a high quality of
care, wherever possible from people they know and feel able to trust. I will be looking carefully at how the recently announced arrangements meet these two criteria and am currently seeking answers from Wirral Borough Council since it is traumatic for the companies that have lost out, some of whom feel they were providing excellent service."
A spokesman for Wirral Borough Council said: "The decision was based on a full evaluation of quality standards. "We will strive to ensure any potential disruption to the service-users is minimised."
The spokesman also pointed out that while Liverpool branches of Local Solutions were investigated by the Commission for Social Care Inspection (CSCI) after complaints, the council was not aware of any complaints in relation to the firm's Wirral operation.
CSCI published the results of its inspection of the Liverpool-based firm last week and highlighted problems with carers not carrying out visits to service users and a failure to obtain criminal record checks for staff.
Last night, Liverpool councillors said they were preparing to table a motion for the report to be scrutinised.
Lib-Dem councillor for the Yewtree ward Roger Johnston said: "We want the Health and Social Care Health Select Committee to look closely at the report and tell us what they are going to do to protect vulnerable people in this city."
