First-ever comprehensive labor neutrality agreement in semiconductor industry sets historic precedent

In a significant milestone for the semiconductor manufacturing industry, IUE-CWA, Alameda County Building and Construction Trades Council, Jobs to Move America, and Akash Systems, an innovative chip-maker, have announced labor agreements covering both construction and production workers, including an historic first-in-the-industry labor neutrality agreement for semiconductor production workers at a new $432 million Akash Systems factory set for construction in West Oakland, CA. The facility will employ an estimated 500 workers over the next five years, of which about half will be production related.

Under the labor peace agreement (LPA) signed by IUE-CWA and Akash Systems, production workers at Akash will be able to exercise their freedom to form a union without interference from the employer. The groups plan to collaborate with Jobs to Move America on a strategy to deliver benefits to the West Oakland community, including a workforce development plan encompassing recruitment and training of under-represented groups.

This agreement marks a major step towards fostering stability, productivity, and long-term sustainability in an industry that operates in a highly competitive and rapidly changing environment.

"As we ramp up semiconductor production in the US, companies can choose whether or not to use the sector’s expansion to create high-quality jobs for American workers. Akash has proven that this can be a win-win for everyone,” said IUE-CWA President, Carl Kennebrew. “Community-sustaining good union jobs are essential for the prosperity of America's semiconductor industry. This agreement with Akash is a game-changer, not only for the hundreds of workers at the new Oakland factory but also for setting a powerful precedent for workers across the industry to unite and elevate standards for these jobs nationwide."

Labor peace agreements are crucial in industries like semiconductor manufacturing, where labor disputes can have a profound impact on business operations, leading to lost revenue, reputational damage, and even regulatory sanctions. The Akash-IUE-CWA agreement aims to mitigate such risks and create a productive environment for both the employer and workers, giving the company a competitive advantage.

Akash’s Project Labor Agreement with the Alameda Building Trades is a pre-hire collective bargaining agreement, establishing the terms and conditions of employment for construction workers.

The West Oakland Fab will be the first in the world dedicated to the production of a ground-breaking compound semiconductor, GaN-on-Diamond, a chip technology pioneered by Akash’s founders, which have applications in clean-energy equipment, electric vehicles, communications and aerospace/defense.

“I am proud to represent a region that is a leader in American technological innovation, with a Black-owned business like Akash Systems leading the way in the semiconductor industry,” said Congresswoman Barbara Lee. “This deal between IUE-CWA, Alameda County Building and Construction Trades Council, Jobs to Move America and Akash Systems is a major victory for workers in Oakland and the manufacturing industry as a whole. As workers across the country leverage their organizing power, this is a huge step in the right direction for East Bay communities.”

This new agreement to support the right of semiconductor workers to form unions is part of Akash’s pioneering strategy to continue to move the industry forward with a focus on long-term success and bringing their innovative technology to a wide range of sectors critical to the success of America’s economy.

Links:

First-ever comprehensive labor neutrality agreement in semiconductor industry sets historic new precedent on brink of $52 billion allocation of federal CHIPS funding (CWA, Nov. 27, 2023)

New Frontiers for Empowering Workers and Business (U.S. Department of Labor, Dec. 19, 2023)