Rotorua principals are calling the latest Government offer a "complete lack of respect", following the nationwide NZEI primary principals' choice to reject it.
Primary principals who belong to the union voted to decline the offer, worth more than $64 million, following a ballot last week.
The increase was a poke in the eye for Rotorua Westbrook School principal Colin Watkins.
He said the lack of movement for principals could cause significant implications on the quality and future of education in New Zealand.
"It has the potential to be the death of rural education in New Zealand.
"Because who on earth would want to be a principal in a rural school where you don't just have to run the school but you've also got to teach."
Teaching principals fall into the bracket of principals and therefore did not receive a pay increase with teachers in June.
He said it was a complete lack of respect when teachers could be earning $20,000 more a year than the principal in the same school.
Deputy secretary for early learning and student achievement from the Ministry of Education Ellen MacGregor-Reid said the offer was a significant amount of money for the just over 1900 principals nationwide.
She said the rejected offer had included additional staffing to support principals in some of the smallest schools and addressed issues of workload, wellbeing and pay parity between groups of principals.
Teresa Topp said being principal at Waikite Valley School was a career choice but she would like it to be rewarded accordingly.
She said the responsibility was a reward itself but she felt it was a kick in the teeth to know her teachers were earning more than her.
"But I hold nothing against them [teachers] because I know exactly what they do because I do it alongside them."
Primary and intermediate principals, who are part of the NZEI, also voted to stop communication with the Ministry of Education and cease participation in any Ministry-led activities.
NZEI representatives will be meeting with the Ministry later this afternoon to continue discussions.