TSMC employees are openly discussing unionizing and even staging a strike after reports claimed the company may cut performance bonuses by about 15%. The backlash comes at a difficult moment for the chip giant. TSMC just posted record profits, driven by strong demand for AI chips, yet workers fear they may receive a smaller share of those gains.
According to a DigiTimes report, employees believe TSMC has reduced its long-standing profit-sharing formula. In past years, the company returned about 13% of retained earnings through employee bonuses. Workers now question whether that practice is changing even as company profits keep climbing.
TSMC reported first-quarter net profit of NT$572.5 billion, or about $17.9 billion. That marked a 58% increase from the same period last year. AI demand from major customers continues to fuel growth. Against that backdrop, reports of lower bonuses have sparked frustration inside the company.
TSMC pushed back against the concerns. The company said employee profit-sharing bonuses are expected to grow faster in 2026 than they did in 2025. It also said it recognizes its expanding corporate responsibility in Taiwan.
TSMC at a Crossroads: Balancing Massive Capital Expansion with Employee Compensation Expectations
One reason behind the rumored bonus reduction may be TSMC’s heavy spending plans. The company is investing between $52 billion and $56 billion each year to expand production capacity. It is building 12 new fabs across Taiwan, the United States, Japan, and Germany. These projects aim to secure TSMC’s lead in advanced nodes such as 2nm and 1.4nm manufacturing.
That scale of expansion comes with a cost. Analysts cited in Taiwanese and South Korean media suggest that large capital spending programs may be leaving less room for employee compensation.
Even so, TSMC employees already receive sizable payouts by most standards. Based on 2025 earnings, the average employee bonus reached about NT$2.64 million, or roughly $87,000. The total bonus pool stood near NT$206.1 billion, according to Taiwan’s Liberty Times. Still, workers argue that the issue is not the amount alone. Many are focused on how much of the company’s growing profit reaches employees.
The debate has intensified after Samsung reached a major labor agreement with its semiconductor workforce. Last week, Samsung avoided a lengthy factory shutdown by striking a deal with its union. The agreement commits 10.5% of semiconductor division operating profit to stock-based bonuses, plus another 1.5% in cash, spread across 10 years.
That arrangement could lead to projected payouts of about $340,000 per employee in Samsung’s chip division in 2026, based on recent profit estimates.
SK hynix uses a similar model. The company agreed last year to allocate 10% of operating profit toward employee bonuses.
TSMC Faces Rising Employee Discontent Amid Global Chip Race
For many TSMC workers, those comparisons are difficult to ignore. Unlike Samsung and SK hynix, TSMC has operated without a labor union since its founding in 1987. Employees have no formal structure to negotiate pay or profit sharing.
Discontent has spilled into public forums. Workers have posted complaints on Dcard, a Taiwanese online community, and on TSMC-focused Facebook groups ahead of the company’s shareholder meeting in Hsinchu on May 28. Some employees have questioned whether forming a union would comply with Taiwanese law. Others argue that the company places too much emphasis on shareholder returns and overseas expansion.
The broader issue reaches beyond one company. Doris Hsu, chairperson of GlobalWafers, weighed in on the debate by pointing to her company’s global operations. Across GlobalWafers’ factories, some sites have unions while others do not. In her view, the key question is not union status but whether companies share profits with workers.
Samsung’s new deal also shows the risks tied to profit-sharing promises. The agreement now faces a shareholder lawsuit that challenges the idea of locking in a fixed percentage of operating profit for employee payouts over a decade. Critics argue that chip manufacturing demands massive investment and that rigid bonus commitments could strain long-term capital needs.
For TSMC, the coming shareholder meeting may offer a clearer view of how management plans to balance worker expectations, shareholder demands, and the enormous cost of staying ahead in the global chip race.
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