The Principals' Federation says schools should bill the Government for the hours they have spent trying to fix the Novopay payroll system.
The federation has written to the office of the Auditor-General calling for an investigation into Novopay's problems and whether good process is being followed to resolve them.
It supports calls by the Secondary Principals Association in Christchurch for schools to invoice the Ministry of Education for the extra hours that are being worked.
Federation vice president Philip Harding said he has heard of some schools putting in more than 500 hours of work just to sort pay issues.
Thousands of staff have been incorrectly paid since the system for more than 92,000 school staff was introduced in August.
The final pay round for this year on 21 December was still rife with mistakes. In one case, the federation said, four teacher aides were paid thousands of dollars despite not having worked at the school involved in 2012.
Mr Harding said principals have reached breaking point after waiting for months for the system to be sorted out.
"We think it's gone beyond anything remotely acceptable. The last pay was the straw that broke the camel's back."
He said the nature of the errors is bizarre and principals are now concerned the system will never be fixed.
Invoice the ministry, says principal
In Canterbury, schools are being urged to bill the Government for the extra hours spent on Novopay problems.
Canterbury-West Coast Secondary Principals' Association chairman Neil Wilkinson said schools are frustrated as errors continue.
Mr Wilkinson, principal of Amuri Area School, said he will invoice the Ministry of Education for additional hours worked by a staff member who has been dealing with the problems in the system.