Biden Commerce Department approves $6.6 billion for semiconductor firm hit with discrimination suit

Another $6.6 billion has been awarded to Arizona’s Taiwan Semiconductor Manufacturing Company just days after numerous former TSMC employees filed a class action lawsuit against the organization for discrimination.

This facility was established following the CHIPS & Science Act that was signed by President Joe Biden two years ago. The goal was to bring chip manufacturing to the U.S. and increase jobs for Americans.

“We have since delivered on that promise, catalyzing nearly $450 billion in private investment in semiconductors, creating over 125,000 new construction and manufacturing jobs, and reshoring critical technologies to bolster our national and economic security,” Biden said in a statement. “Today’s final agreement with TSMC – the world’s leading manufacturer of advanced semiconductors – will spur $65 billion dollars of private investment to build three state-of-the-art facilities in Arizona and create tens of thousands of jobs by the end of the decade.”

However, plaintiffs in the lawsuit state that TSMC is not bringing more jobs to Americans, but discriminating against those who are not East Asian, Taiwanese or Chinese.

“TSMC employs over 76,000 employees worldwide, including 2,668 workers in North America as of December 31, 2023, the vast majority of whom are from Taiwan or China, and many of whom require visas in order to work in the U.S,” reads the lawsuit. “This grossly disproportionate workforce is the result of TSMC’s intentional pattern and practice of employment discrimination against individuals who are not of East Asian race, not of Taiwanese or Chinese national origin, and who are not citizens of Taiwan or China, including discrimination in hiring, staffing, promotion, and retention/termination decisions.”

When applying for CHIPS Act funding, TSMC submitted a diversity plan which would create 6,000 direct manufacturing jobs and over 20,000 construction jobs.

Statements from the plaintiffs indicate that TSMC gave preference to those of East Asian descent, Taiwanese or Chinese and would even provide visas to individuals from Taiwan for them to come work in the U.S. Almost half of those who are slated to work at the semiconductor facility in Phoenix have been deployed on visas from Taiwan.

“Recruiters in the U.S. have also been explicitly instructed by the Taiwan Headquarters Global Recruitment Program Leaders that the goal for recruiting new graduates from U.S. universities is to hire primarily Taiwanese and Chinese candidates, and to target only universities known to have higher populations of Taiwanese and Chinese students,” reads the lawsuit.

Additionally, while company policy is that business be conducted in English, TSMC has put fluency in Mandarin as a requirement in job postings. Plaintiffs stated incidents where business meetings were conducted completely in Mandarin, so those who only spoke English could not participate. Furthermore, plaintiffs cited times where they were yelled at and called “lazy” or “stupid” because they were American.

“TSMC chairman Mark Liu complained of ‘an insufficient amount of skilled workers’ to build the facility and planned to fly workers in from Taiwan,” reads the lawsuit. “TSMC agreed to focus on local hiring for those positions only after a massive and public outcry from Arizona labor unions.”

The lawsuit goes on to state, “Taiwanese construction managers also subject non-East Asian and nonTaiwanese/Chinese workers to a hostile work environment in which they are constantly berated and expected to work long hours without pay, resulting in low morale for this classification of worker. When American construction workers—who are unionized— pushed back on the long, unpaid hours, the message from Taiwanese management was ‘Are all union workers this slow?’”

The complaint included statements from former TSMC employees.

According to James Perry who formerly worked at TSMC Arizona, 10-15 Americans left the company due to discrimination during the year he worked there.

Lacey Bostick, former TSMC Arizona employee, spoke up about constant verbal abuse he has suffered during his seven months with the company. He cited incidents where his manager would yell at him in open meeting spaces and in front of other colleagues. One time she even stated, “I just hate you. You sit there and you never fight back.”

Another U.S. employee for TSMC Arizona was based in Taiwan for training and despite her advanced credentials and hard work, she received low scores on her work, meaning she got paid less. After a year-and-a-half, she notified TSMC that she was planning to resign. TSMC then forced her to move out of her TSMC-funded dorm without enough time to pack. She had to leave half of her belongings in Taiwan and pay for her own return flight.

These are just a few examples of the numerous American employees who left TSMC Arizona because of a hostile work environment, the complaint alleged. However, politicians are continuing to support TSMC semiconductor facilities in Arizona.

“Thanks to our bipartisan CHIPS and Science Act, Arizona continues to see historic investments in cutting-edge semiconductor manufacturing,” said Senator-Elect Ruben Gallego in a statement. “Today’s finalized award for TSMC will create thousands of good-paying jobs and strengthen our national security. I’m excited to make this announcement and look forward to working with TSMC and state and local leaders to ensure its success.”