The President of the Irish Medical Organisation has said that it is not willing to wait for a High Court ruling and will ballot members for industrial action.
The IMO is to ballot its non-consultant hospital doctor members after pay talks broke down.
The IMO has taken a High Court case on behalf of 4,000 NCHDs seeking restoration of a €3,000 "living-out" allowance which was scrapped during the economic crisis.
However, the case was adjourned on 27 October when both sides agreed to enter three weeks of intensive talks in a bid to find a compromise.
According to the IMO, the Department of Health and the Department of Public Expenditure and Reform today "completely disengaged" from those discussions, and the union has accused them of breaching their agreement.
It says it will now ballot for industrial action while also continuing to pursue the High Court action.
Speaking on RTÉ's Six One, IMO President Dr John Duddy said the IMO is willing to re-engage in talks with the Government.
"We have entered into the agreement in good faith and are willing to engage in talks and we feel that balloting for industrial action will add impetus to the other side to come back and talk to us," said Mr Duddy.
He said the IMO does not believe it has a choice but to ballot members for industrial action.
"Doctors want to talk and settle this matter through the usual channels, however when the other side won't even talk to us, we feel we have no choice but to ballot our members."
In a statement this evening, the Department of Health said: "Both the Minister for Public Expenditure and Reform, and his colleague the Minister for Health are committed to engagement with the IMO on matters of mutual concern.
"The particular issue of the 'Living Out Allowance' which is under consideration by both parties (Management and IMO) involves potentially significant exchequer resources which have not been provided for in either the current or next year's budgetary provision.
"Accordingly, this issue would need to be considered in the context of wider Public Sector engagement."
Earlier Dr Duddy described today's developments as a further example of the lack of respect for doctors and ignoring the crisis of retaining doctors in Ireland.
He said it was typical of Government to reach agreements and breach them within a matter of weeks - leaving doctors with no choice but to consider all avenues to have their issues resolved, including industrial action.
Speaking on RTÉ’s Drivetime, Dr Duddy said doctors are not being treated with respect by their employer and Government policy is driving doctors out of the country.
"Why would they work in a health system where they are not being treated with respect by their employer; they are not having their contract honoured and they are not being given the facilities they need in General Practice, or in hospitals to do their job," he said.
"He said there's a growing anger among young doctors at how they perceive they are being treated by the Irish health service."