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A massive semiconductor plant in Arizona was supposed to be a win for everyone involved. Now it's hitting snags.

Last month the Arizona Building and Construction Trades Council alleged the Taiwanese company is trying to replace union workers with less-skilled Taiwanese workers.

PHOENIX — An alliance of labor unions in Arizona is holding discussions with Taiwanese manufacturer TSMC this week about labor needs and worksite conditions at the massive construction site in north Phoenix.

Last month the Arizona Building and Construction Trades Council alleged the Taiwanese company is trying to replace union workers with hundreds of less-skilled Taiwanese workers. The President of the council said TSMC previously assured him Arizona workers would continue building the plant through its completion. In August, TSMC announced a shortage of trained construction workers and said the factory will not open as planned in 2024.

“We are filling their requests for jobs and working on a long-term agreement,” said a spokesperson for the council on Monday. The council estimates about one-fourth of the 12,000 workers on the job site are union members.

Gov.Hobbs meets with company executives

The crown jewel of Pres. Biden’s Chips and Science Act is projected to make Arizona a global player in microchip manufacturing. But since last year’s groundbreaking, TSMC has faced delays and criticism.

Gov. Hobbs announced last month a voluntary agreement between the company and the state to implement higher safety standards and oversight for workers. Hobbs met with TSMC leaders over the weekend during her trip to Tawain. A spokesperson for Hobbs said the governor’s office “has been working closely with labor and TSMC representatives to make sure this project is a win-win for the company and Arizona workers.”

Questions about chip manufacturing process

Last week, the tech news site, The Information reported that many advanced chips made at the plant will require additional assembly in Tawain for a process known as packaging.

The website cited unnamed TSMC engineers and former Apple employees in its story.

Asked about that report, a spokesperson for Senator Mark Kelly told 12News Monday the senator negotiated the legislation to cover the packaging of chips.

“For Senator Kelly, it’s always been clear that strengthening American leadership in microchips must cover every step of the process, including advanced packaging,” the spokesperson said in an email. “That’s why, as a chief negotiator of the CHIPS and Science Act, Kelly included investments in microchip packaging to bring the most advanced capabilities here to America.”

12News has asked TSMC about the report and has not yet received a response.

A second plant also planned in Valley

During a December 2022 celebration, the company announced it would build a second plant in the Valley as well. TSMC advertised the two facilities would be “the greenest” in the United States, using recycled water and low-power energy sources.

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