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The Post Primary Teachers' Association is launching legal action over Novopay.
PPTA president Angela Roberts said the association would seek compensation for members for the hurt, humiliation and financial suffering caused by the "dysfunctional" payroll system.
The union's national executives met at the weekend and decided to take collective legal action on behalf of members.
Because of the complexity of the case, the association was looking at a number of legal options, Roberts said.
"It is an unusual situation in that traditionally any action would be taken against a school's board as the employer, but in this case the boards are just as frustrated with Novopay as their staff,'' Roberts said.
The PPTA was collecting data, preparing witness statements and discussing the case with its lawyers.
Novopay has consistently failed to pay all school staff correctly and on time, since being launched in August.
''Despite reassuring noises made by government representatives, as late in the piece as yesterday there were still no definite plans to roll out a resourced survival package for affected schools and their employees,'' Roberts said.
''In the face of this, and growing pressure from struggling members, PPTA has decided to take matters into its own hands.
"Members' patience and goodwill has all but run out. Continued Novopay errors mean schools, students, principals and administration staff are at the end of their tether."
Minister Steven Joyce has taken the helm of Novopay, to try to resolve ongoing issues that include not paying child support payments, students loans or Kiwi Saver.
Joyce said Novopay provider Talent2 was planning three software upgrades.
One took place over the weekend and the next two would happen in March and April.
Those were designed to address ''the most significant bugs in the system'', he said.
- The Press