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TSMC employees are openly discussing forming a union and staging a strike after rumors spread that the company plans to cut performance bonuses by approximately 15%, according to a DigiTimes report published today. The rumored haircut comes despite TSMC posting a record first-quarter net profit of NT$572.5 billion ($17.9 billion), a 58% year-over-year increase driven by surging AI chip demand. Workers say the company's historical practice of returning roughly 13% of retained earnings as employee bonuses has been cut, even as profits climb, and they’re pointing to Samsung’s recent union deal as a template for action.Go deeper with TH Premium: ChipmakingTSMC responded by saying it expects employee profit-sharing bonuses to grow faster in 2026 than in 2025, and that it is "fully aware of its growing corporate social responsibility in Taiwan," Digitimes reported.The most likely explanation for the rumored cut, according to analysts cited by South Korean and Taiwanese media, is TSMC’s capex program. The company is spending $52 billion to $56 billion annually while constructing 12 new fabs across the U.S., Japan, Germany, and Taiwan to secure its lead in 2nm and 1.4nm manufacturing. That outlay appears to be tightening the cash available for employee compensation.Based on 2025 earnings, the average TSMC employee bonus was approximately NT$2.64 million (roughly $87,000), with the total bonus pool reaching around NT$206.1 billion, according to Taiwan’s Liberty Times. Frustrations have risen around the ratio of profits going to employeesThe unrest at TSMC has intensified in the wake of Samsung’s landmark union deal last week. Samsung narrowly avoided an 18-day factory shutdown by agreeing to allocate 10.5% of its semiconductor division's operating profit as stock-based bonuses, plus another 1.5% in cash, over a 10-year period. That deal translates to projected average payouts of roughly $340,000 per chip division employee in 2026, based on recent estimates of Samsung's operating profit.SK hynix agreed to a similar structure last September, setting aside 10% of operating profit for employee bonuses. The comparison is undoubtedly painful for TSMC workers, who have no union and no formal mechanism to negotiate collectively; the company has operated without a labor union since its founding in 1987.Employee frustration has spilled onto Dcard, a Taiwanese workplace community, and dedicated TSMC Facebook pages, where workers have posted complaints ahead of TSMC's shareholder meeting scheduled for May 28th at the company's Hsinchu headquarters. Some have asked whether forming a union would violate Taiwanese law, and others argue that the company prioritizes shareholder returns and overseas expansion over its workforce.Get Tom's Hardware's best news and in-depth reviews, straight to your inbox.Doris Hsu, chairperson of silicon wafer manufacturer GlobalWafers, has weighed in on the broader debate, saying that across GlobalWafers' 18 factories in nine countries, some have unions and some don’t, and that the key factor in business performance is whether a company shares profits with workers, not whether a union exists.Samsung's deal, meanwhile, is already facing legal pushback. A shareholder lawsuit challenges the agreement on the grounds that committing a fixed percentage of operating profit to employee payouts over a decade conflicts with the capital demands of chipmaking at scale.
