TSMC, the world's largest semiconductor foundry, is grappling with internal unrest over rumors of bonus cuts. As complaints grew despite record-breaking earnings, Chairman C.C. Wei canceled a business trip and personally met with employees to address the concerns.
"15% Bonus Cut?"…Rumor Shakes TSMC
According to Taiwan's Liberty Times and the Central News Agency (CNA) on the 27th, TSMC Chairman C.C. Wei held an emergency meeting with employees that morning to quell the bonus cut controversy.
Earlier, rumors that "this year's bonuses could be cut by up to 15%" had spread rapidly across TSMC's internal communities and online boards. Concerns mounted that employee compensation might shrink as TSMC pours massive funds into expanding plants in the United States, Japan and Germany, as well as into advanced process investments.
TSMC is indeed continuing aggressive global investment plans this year. Tens of trillions of won are being injected into expanding the Arizona plant in the U.S. and the Kumamoto plant in Japan, along with scaling up next-generation AI chip production.
As the rumors spread, some employees voiced strong dissatisfaction on internal boards and social media. Reactions included, "We work late every night, but in the end only shareholders get rewarded," and "Employee compensation should be strengthened, like Samsung Electronics." Posts mentioning the possibility of forming a union or staging a strike also appeared.
Chairman Cancels Trip…"Buy TSMC Stock With Your Bonus"
As the controversy escalated, Chairman Wei canceled a scheduled business trip and met with employees in person. TSMC reportedly opened applications for the meeting through an internal notice the previous day, and registration closed within 30 minutes. Some employees compared the rush to "booking concert tickets."
At the meeting, Chairman Wei flatly denied the bonus cut rumors, saying, "First-quarter bonuses this year will be about 30% higher than the same period last year." He emphasized, "Since 2023, employee bonuses have increased by more than 30% every year," adding, "We will maintain strong growth this year as well."
He was also quoted as saying, "There is no cap on TSMC bonuses," and "I have very strong confidence in the company's future. If you buy TSMC stock with your bonus, you won't have to worry about your livelihood going forward."
On suspicions that certain business units take a disproportionate share of bonuses, he explained, "Unlike other companies, we don't determine the size of compensation based on which department made money," adding, "Even units that don't generate profit are all important members of the company." Regarding concerns about employees defecting to competitors, he drew a line, saying, "I'm not very worried about a talent drain."
"Anxious Despite Record Earnings"…Fierce Talent Competition
TSMC reported first-quarter net profit of 572.5 billion New Taiwan dollars (approximately 27 trillion won), up 58% from a year earlier. Revenue rose 35% over the same period. Surging demand for AI chips drove results above market expectations.
Still, analysts say employee anxiety has grown due to TSMC's notoriously demanding work culture and the burden of future investments.
Within TSMC, suspicions have persisted that "even with strong earnings, employees' share will end up shrinking because of investment burdens." Internal tensions have reportedly risen further as cost pressures grew following construction of the U.S. plant.
Reactions from some employees remained cold even after the meeting. Posts on local anonymous platforms continued: "It wasn't communication, it was effectively an announcement," "Mutual trust is being shaken," and "In the end, it was just a venue to convey the direction the company had already set."
Industry observers, however, view the actual likelihood of a strike as limited. While TSMC has an employee welfare committee, it does not have a strong labor union system like those in South Korea.
Analysts say this controversy is not merely a bonus issue but is also tied to talent management challenges at TSMC, which has become a core company in the AI chip era.
Currently, most global big tech firms — including Nvidia, AMD, Apple and Qualcomm — depend on TSMC's production lines. With the explosive growth in AI chip demand, TSMC's strategic importance has grown far beyond past levels.
The industry sees a strong possibility that TSMC's internal morale and compensation issues will emerge as increasingly important management variables, as Samsung Electronics, Intel and Chinese chipmakers all aggressively join the race for talent.
