Taiwan's Semiconductor Giants Face Scrutiny Over Migrant Worker Treatment
taipei, Thursday, 3 July 2025.
A new human rights report alleges severe mistreatment of Filipino migrant workers within Taiwan’s semiconductor factories. Workers reportedly face 16-hour shifts and threats of deportation. A broker system that exploits workers is also allegedly in place. These allegations raise concerns about ethical and labor compliance at major manufacturers, including TSMC. The industry relies on these workers, with tens of thousands employed and an expected increase of 20,000 this year. The report urges immediate investigations and reforms to address these systemic issues.
TSMC’s Dominance and Ethical Concerns
TSMC is the world’s largest semiconductor producer, responsible for approximately 90% of the world’s most advanced semiconductors [1]. The allegations of mistreatment could impact investor confidence as ethical considerations increasingly influence investment decisions. Labor practices within TSMC and other Taiwanese manufacturers are under scrutiny, potentially affecting their ability to maintain current production levels [1]. Any disruption could further strain the global chip supply and affect numerous industries reliant on semiconductors [GPT].
Potential Impact on Manufacturing Capacity
The alleged labor abuses could lead to operational disruptions if investigations or reforms result in changes to working conditions or labor availability. Sixteen-hour shifts and the alleged exploitative broker system are central to the accusations [1]. Corrective actions may reduce the productivity of the workforce [alert! ‘difficult to quantify without knowing the extent of the mistreatment’], impacting TSMC’s manufacturing capacity and potentially delaying chip production for key clients. These clients span various sectors, including automotive, consumer electronics, and telecommunications [GPT].
Geopolitical Risks and Market Leadership
These allegations come at a sensitive time, as Taiwan’s geopolitical importance is already heightened [3]. Any perceived instability or ethical lapses within its semiconductor industry could be viewed as a vulnerability. Premier Cho Jung-tai stated Taiwan is willing to take more responsibility for its defense, highlighting existing concerns [3]. Negative perceptions could erode trust in Taiwanese manufacturers, potentially leading to diversification of supply chains and impacting TSMC’s market leadership [alert! ‘this is a potential outcome, not a certainty’].
Industry Initiatives and Government Support
Taiwan is actively trying to bolster its semiconductor workforce through training programs [2]. The Hsinchu City Government, along with National Yang Ming Chiao Tung University, offers courses to train professionals in semiconductors [2]. Such initiatives aim to address labor shortages and improve workforce skills, but they do not directly address the alleged mistreatment of migrant workers [2]. Addressing these allegations is crucial to ensuring the long-term stability and ethical standing of Taiwan’s semiconductor industry [1].