Chroma regards our employers as a key company asset. We ensure diversity and inclusion and our employee recruitment policy is to offer equal opportunities to all. We are in line with human rights in constitution and gender equality prescribed by the Act of Gender Equality in Employment. We do not allow any discrimination based on language, attitude or behavior, race, socio-economic status, age, marital status, family status, language, religion, political affiliation, nationality, physical appearance or physical or mental disability. Chroma had a total of 1,964 employees on its payroll at the end of 2022. The electronics sector, to which our company belongs, is strongly oriented towards R&D and technology and our employee profile shows a significant discrepancy in terms of the male to female ratio. Male employees totaled 1,519 (77.34%) against 445 females (22.66%). The average age of our employees is 38.15 years, with average work seniority of 7.93 years. All these are full-time employees.

We have endeavored to hire and retain outstanding management talent. Our senior management includes divisional VPs and high-ranking supervisors, BU presidents, the VPs of various centers and the President of the Company. All of our senior managers are native citizens of the Republic of China (Taiwan) and the senior management-level personnel (21) makes up 1.07% of the total.

Our workforce is diverse and in addition to native citizens of Taiwan (ROC), we have workers from the Philippines, Vietnam, Malaysia, the Netherlands and South Korea. This is a clear demonstration of a diversified workforce. The foreign workers are entitled to all the benefits and perks enjoyed by native workers, regardless of nationality. In support of the government policy that ensures employment opportunities for people with disabilities and to promote an innovative and friendly workplace, we hired 11 employees with disabilities (7 with severe disabilities) in 2022. They have been assigned to departments where they can fully leverage their talent and contribute to society in their own ways. We will continue to evaluate and assess positions that may be suitable for people with disabilities to provide more such employment opportunities.

The existing workforce in the company includes people in managerial, R&D, technical, sales, and administrative and staffing positions. To recruit talented individuals from different areas of specialization and set career development for employees, we planned the "career hierarchy system" in 2019 which was introduced on January 1, 2021. In this system jobs are divided into seven categories: management, R&D, engineering, product management, sales, professional, production, and management. This allows professional career development in a specific direction. By the end of 2022, the number of management personnel was 235, slightly less than in the previous year, and accounting for 11.97% of the total workforce.

We insist on the nurture of outstanding talent. In 2022, 328 new employees were hired, with a new employment rate of 16.71%. Close to 50% of them were fresh graduates. We hope that Chroma’s overall efficiency and image can be improved by hiring more young, competent and talented people, leading to higher profit and sustainable operation.

To ensure a steady influx of new blood into the Company while taking external factors such as the current economy into account, it was decided to work towards maintaining a healthy turnover rate of between 5% - 10%. Over the past three years, we have worked hard to keep our annual turnover rate down and the fact that it has been steadily falling during this time reflects our talent retention efforts. A reduction of our employee turnover rate remains an important goal for the year. A reduction of turnover rate not only helps the Company by reducing personnel training costs and other intangible HR costs from unnecessary turnover and severance pay, but also facilitates optimal HR efficacy. This will in turn create more value for our shareholders and pave the way to an environment that will help employees make the most of their talent. A total of 225 employees left the Company in 2022. This figure includes those who retired. Among them, 221 resigned voluntarily; 4 were laid off; 5 who were qualified to retire under the Labor Standards Act and retired voluntarily; 64 were foreigners and 7 were contract personnel. The turnover rate for the year was 7.84%.

Our offices include those at headquarters, the Huaya Plant, and the Hsinchu and Kaohsiung Branches. Employee salaries are determined by the human resources unit according to market-based salaries and the financial status and organizational structure of the Company. Their overall remuneration is calculated based on individual competency, assigned responsibility, performance, and achievement of the operational goals of the Company. New employees will never receive any kind of differential treatment in terms of salary due to their gender, race, party affiliation, thinking, religion, sexual orientation or marital status. Position, assigned responsibilities, performance and competency are taken into account and the Company "Salary Grade" is used as a basis for their overall remuneration.

Chroma's average salary ratio between male and female employees holding similar positions across different fields and offices is nearly 1:1. However, as Company operations involve technical R&D and intensive technologies, most of our R&D and technical positions are held by men and a good many of our female staff are in administrative positions. This means that despite our attempts to have comparable pay grades, discrepancies still exist, which explains why female employees receive slightly less salary compared to their male colleagues at the same job level.

Chroma "treats employees like family". It is a matter of utmost concern to Chroma that all employees receive the same proper care and treatment. The Company welfare system meets the needs of employees with food, clothing, accommodation, commuting, education and recreation to allow them to work with us without having to worry about daily needs. We also offer a variety of communication channels to gather information about employee needs to improve our welfare measures. Several recreational, medical and health facilities and services have been provided in our plants for our employees to focus on their work with the aim of "work healthy and live happily". We have made comprehensive efforts in employee care, in the hope that our employees will be able to maintain a balance between hard work and a healthy and happy family life. In full accordance with the law, we provide our employees with labor and health insurance and maternity allowance/unpaid parental leave. A certain percentage of employee wages is taken as contribution to the pension fund (under the new scheme)/reserve funds (under the old scheme). All employees are covered by comprehensive group insurance, and our leave benefits are more favorable than those set down in the Labor Standards Act. The benefits include one-day birthday leave and five days of paid sick leave annually. We want to make sure our employees can work and live safely and find time to relax and rest.

We encourage our female employees to breastfeed their babies after birth. In our building, there are lactation rooms with refrigerators for the storage of breast milk and stringent access control. By providing such exclusive space for our female employees, we make them feel comfortable and protect their privacy and safety while enabling them to place equal emphasis on both family and work. An employee who has been in their job for at least six (6) months may, in accordance with the "Act of Gender Equality in Employment" and "Regulations for Implementing Unpaid Parental Leave for Raising Children", apply for unpaid parental leave before their child reaches the age of three. The leave shall be no more than two (2) years in extent. The Company arranges employees to return to their original unit and position after the unpaid parental leave has expired. A total of 13 employees applied for unpaid parental leave in 2022. Their average reinstatement rate was 75%, with an 85.71% retention rate.

We take employee development very seriously and perceive the cultivation and development of talented individuals as a real competitive edge. As such, we have planned a fully comprehensive system for education and training and have developed relevant training programs and courses designed to help employees boost their vocational skills, management capacity and achieve self-development. Chroma has therefore built a comprehensive system for training and education and established an “Education and Training Management Procedure” as the basis for all the education and training courses that are offered each year. Our training plans are proposed in accordance with the needs of each department and regular enhancements and improvements are made to the training system each year that continue to boost employee competency.

In response to the advent of the post-COVID era in 2022, in addition to the strengthening the dual-track career path from an original professional position, to one in management, or education and training, was implemented in a more diversified way. This gives talented professionals in various fields access to more comprehensive and
effective resources. 

Chroma uses a system for performance evaluation that involves Management by Objectives to ensure a fair and reasonable procedure for performance evaluation. The system is used to evaluate employee work performance. Outcome of the evaluation serves as a basis for considerations such as appointment to a specific position,
promotion, increments, training, career development etc. The main goal of performance evaluation is improvement of overall employee performance and contribution to the fulfillment of the Chroma operational plans. The focus of the objective-oriented management system is as follows:

1. Two aspects: results and behavior.
2. Three stages: initial setting, mid-term review and final evaluation. (The performance appraisals take place twice a year.)
3. Two objectives: both of these, employee development and human resources policies, are designed to facilitate superior-subordinate communication and organizational feedback.

Given that work objectives and goals are more difficult to assess and define for direct personnel and street-level administrative staff, Chroma has retained its original job performance evaluation system that examines employee performance for specific work items in conjunction with an objective-oriented system. Criteria for job performance evaluation include: work quality, work efficiency, work competency and service spirit.

The results of evaluation by the performance management system are incorporated into the promotion management and the reward/remuneration systems to ensure the evaluation of employee performance serves as a proper basis for human resources. With the exception of the managers of business units and staff at high level,
local employees are required to undergo performance evaluation after a three-month probationary period. In 2022, 1,546 employees underwent performance evaluation and 89% underwent objective-oriented performance evaluation and 11% underwent job performance evaluation.

Chroma currently has no established a labor union and therefore has not engaged in any collective bargaining agreements. The benefits and rights of employees are stated in the management regulations of the Company and all labor matters are resolved in quarterly labor-management meetings. Five employee and five employer
representatives attend labor-management meetings where mutual and adequate communication has been established.

*Compliance: Pecuniary Punishment in the Labor Category. There were no fines for non-compliance with labor regulations or the violation of human rights in 2022.