The industrial action at the Coles warehouse in Melbourne entered its third day on Wednesday with Toll Holdings, the operator of the facility, threatening striking workers with legal action.

The strike and picket lines have prevented delivery trucks from entering and leaving the warehouse, in turn threatening supply of products at Coles supermarket shelves.''

Although Coles insisted that the impact would be minimal as the supermarket giant hoped for a swift resolution to the labour problem, talks between Toll and the National Union of Workers broke down on Tuesday, dashing hopes of an early resolution as the employees have opted for an indefinite strike.

Toll insisted that the blocking of staff and vehicles at the Somerton facility is illegal. Prior to the strike, an average of 110 to 130 trucks enter and leave the warehouse weekly to ensure that Coles supermarket shelves are stocked with goods.

"While we respect the rights of union members to take lawful industrial action, we will not tolerate illegal blockading and intimidation. We will be assessing all options in terms of legal action against those participating in this unlawful behaviour," The Australian quoted Toll spokesman Christopher Whitefield.

Toll sent on Tuesday letters to over 400 permanent warehouse employees to inform them that they have been stood down until further notice. Toll washed its hand off the decision by pointing out that the policy to redirect the work to the supermarket giant's other warehouses was made by Coles and not by Toll.

At the centre of dispute is the workers' demand for equal treatment compared to other employees directly hired by Coles, particularly in terms of salaries. Mr Whitefield insisted that Toll, which outsources the workers for Coles, offers 30 per cent higher pay under the relevant wages award.

"The conditions negotiated at this site have enabled us to attract and retain the same high-calibre workers that Toll employs around the country," The Age quoted Mr Whitehall.

NUW State Secretary Tim Kennedy said it would be in Coles's interest to ensure that warehouse workers get the same rates and work conditions as employees of other Coles workers located in other states.

"This warehouse is owned by Coles, the machinery in this warehouse is owned by Coles, the fixtures and the produce are owned by Coles. The only thing Coles does not want to have anything to do with here is the workers," Mr Kennedy was quoted by The Age.

Despite Coles's insistence that the strike has minimal impact on the grocer's sales, NUW said the industrial action would negatively impact the firm's capacity to fill its shelves.

"Most consumers will not take the risk to go to a Coles supermarket now in the belief that things may not be there. They'll probably go to the competition, so it will have a significant effect on sales for Coles," Mr Kennedy added.

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