Global semiconductor companies including TSMC, Intel and Micron are maintaining union-free management policies even as they strengthen performance-based compensation systems, according to industry reports.
According to Reuters, The Wall Street Journal and Nihon Keizai Shimbun on Thursday, major semiconductor firms are continuing to reinforce compensation structures centered on performance bonuses and stock options instead of labor unions.
TSMC, the world's largest foundry, has maintained a union-free policy since its founding in 1987. Even in the mid-2010s, when union activities and strikes spread across Taiwan led by the aviation industry, TSMC did not permit the establishment of a union.
Founder Morris Chang said in a past interview that while unions could bring a slight short-term wage increase and shorter working hours, they could have negative long-term effects on the company and society. "People should recognize that labor disputes brought down the U.S. auto industry," he was quoted as saying.
Instead, TSMC operates a strict performance-based compensation system. The size of performance bonuses is not determined through labor-management negotiations but calculated by the board of directors based on company earnings.
TSMC posted net profit of about 1.72 trillion Taiwan dollars last year and set aside 206.1 billion Taiwan dollars as a performance bonus pool. When simply divided by the total number of employees, this amounts to an average of about 2.64 million Taiwan dollars (approximately 110 million won) per employee.
Intel, a U.S. semiconductor company that handles everything from chip design to manufacturing — similar to Samsung Electronics — has also maintained a union-free stance for about 60 years. When the Biden administration announced a $19.5 billion subsidy and loan support plan for Intel in 2024, it mentioned the need to guarantee union activities, but Intel's position has not significantly changed since, observers say.
Claude Cummings, president of the Communications Workers of America (CWA), said at the time that "initial discussions with Intel have not been going well."
Micron, a memory chipmaker, also operates only limited unions outside of some business sites. Bloomberg recently described Micron's agreement with a plant construction union as "a rare case in the U.S. semiconductor industry."
The industry views the semiconductor sector's unique production structure as one reason for maintaining the union-free stance. Semiconductor plants operate 24 hours a day, year-round. Production requires extremely precise management of temperature, humidity and dust, along with cleanroom environments that even block bacteria.
Unlike segmented manufacturing industries such as automobiles and home appliances, semiconductor production uses a continuous process, requiring considerable time to restart operations once halted. If production lines stop due to strikes or other disruptions, wafers and materials already in process must be discarded.
