In the
United States Court of Appeals
For the Seventh Circuit
No. 10-1482
A MORITA N. T HOMAS, on behalf of Herself and
all others similarly situated,
Plaintiff-Appellant,
v.
H&R B LOCK E ASTERN E NTERPRISES, INC.,
Defendant-Appellee.
Appeal from the United States District Court
for the Southern District of Indiana, Indianapolis Division.
No. 1:08-CV-667—David F. Hamilton, Judge.
A RGUED O CTOBER 20, 2010—D ECIDED JANUARY 12, 2011
Before F LAUM, R IPPLE, and E VANS, Circuit Judges.
F LAUM, Circuit Judge. Amorita Thomas (“Thomas”)
sued her employer, H&R Block Eastern Enterprises, Inc.
(“H&R Block”), under Indiana’s Wage Payment Statute,
IND. C ODE § 22-2-5-1 et seq. (2010), for paying its end-of-
season (“EOS”) compensation more than ten days after
it was earned. The district court granted H&R Block’s
motion for summary judgment based on a finding that
2 No. 10-1482
EOS compensation did not constitute “wages” under
Illinois statutory law. At issue is whether H&R Block’s
EOS compensation is a wage under Indiana law, and
thus whether it is subject to the Wage Payment Statute,
which requires employers to pay “wages” no more than
ten days after they are earned. Both Indiana and federal
case law provide guidelines for answering this question.
In light of those guidelines, we affirm.
I. Background
Since neither party argues that the district court con-
sidered evidence it should not have or neglected to con-
sider evidence it should have, we recite the facts that
the district court provided in its opinion granting sum-
mary judgment to H&R Block. See Wragg v. Vill. of
Thornton, 604 F.3d 464, 466 (7th Cir. 2010).
Thomas began working for H&R Block as a seasonal
employee in 2004. She worked only during tax season
(typically from December through mid-April). In both
2006 and 2007, she entered into a Tax Professional Em-
ployment Agreement (“Employment Agreement”) with
H&R Block and worked as a Tax Professional II, responsi-
ble for preparing clients’ tax returns and offering other
financial products and services H&R Block provides.
Thomas was eligible for two forms of compensation as
a Tax Professional II. First, pursuant to her Employment
Agreement, she received an hourly wage and was
eligible for overtime. She received her hourly wage in a
timely manner on a bi-weekly basis during both 2006
No. 10-1482 3
and 2007. Second, she was eligible for EOS compensation.
H&R Block’s Compensation Information Sheet (“Sheet”)
explained the terms and conditions of the EOS compensa-
tion. Thomas was eligible for EOS compensation only
if the sum of various specified amounts exceeded the
aggregate gross hourly wages paid to her during the
tax season (an amount which excluded hourly wages
for certain training exercises). The specified amounts
included, among other things, a few dollars for each
product Thomas sold during the tax season, client re-
tention incentives when a customer whom Thomas
served the prior tax year returned to H&R Block, and a
fee for each tax return she prepared, where the fee
was based on “fees charged to the client and collected by
H&R Block during the Tax Season.” 2006 Compensation
Information Sheet Part 1, ¶ 4 (emphasis added); 2007
Compensation Information Sheet Part 1, ¶ 4 (emphasis
added). Tax Professionals were to be credited for tax
returns paid through April 21, 2006, and April 18, 2007,
and all hours worked and wages earned through
April 21, 2006, and April 20, 2007. The Sheets provided
that EOS compensation would be paid by May 12,
2006, and May 14, 2007, “or as soon thereafter as is rea-
sonable under the circumstances.” 2006 Compensation
Information Sheet Part 6, ¶ 3; 2007 Compensation Infor-
mation Sheet Part 5, ¶ 4.
Thomas was eligible for EOS compensation in 2006
and 2007. Thomas could view daily snapshots of her
accumulated compensation during the tax season, but
the reports did not include all of the data necessary to
calculate the amount of her EOS compensation.
4 No. 10-1482
Payroll processing for the final pay periods’ hourly
wages occurred on April 22, 2006, and April 21, 2007,
respectively. The payroll processes were completed on
April 23, 2006, and April 22, 2007, and the payroll was
mailed to ADP, which printed and mailed Thomas’s
payroll checks, on the same day. Employee checks were
available for deposit on April 26, 2006, and April 25, 2007.
Information was entered into H&R Block’s Financial
Information Network (“FIN”) between April 24 and 26,
2006, and April 23 and 25, 2007. Next, on April 26, 2006,
and April 25, 2007, bookkeepers and managers began
entering EOS compensation information into the FIN.
The deadlines for entering all of the compensation infor-
mation into the payroll system were May 1, 2006, and
May 1, 2007. The Employee Compensation Reports
were created on the same days. Reconciliation periods
began on May 1, 2006, and May 2, 2007, and payroll
processing for EOS compensation began on May 4, 2006,
and May 4, 2007. ADP mailed compensation checks on
May 8, 2006, and May 9, 2007, with issue dates of May 10,
2006, and May 11, 2007. Thomas received her EOS com-
pensation via direct deposit on May 10, 2006, and May 11,
2007.
For the 2006 tax season, H&R Block calculated EOS
compensation for roughly 78,000 professionals in the
United States and actually paid compensation to
roughly 54,000 tax professionals, 1,426 of whom worked
in Indiana. For the 2007 tax season, H&R Block cal-
culated EOS compensation for roughly 80,000 tax profes-
sionals in the United States and actually paid compensa-
No. 10-1482 5
tion to roughly 56,000, 1,437 of whom worked in Indiana.
H&R Block calculated and processed EOS compensa-
tion payments on an expedited basis, which required
significant overtime. JoAnn Atkinson, the director of
H&R Block’s administrative center, testified that she
believed it would be impossible to have calculated
and paid EOS compensation within ten days of the close
of the tax seasons. Atkinson testified that she did not
know how long it would have taken to process pay-
ments for Indiana tax professionals if Indiana had been
done first.
Indiana’s Wage Payment Statute requires employers
to pay “wages” within ten days after they are earned.
IND. C ODE § 22-2-5-1. Pursuant to this the statute,
H&R Block timely paid Thomas her hourly wages. The
parties agree that Thomas’s EOS compensation was
calculated correctly and on the schedule that H&R
Block promised, and that H&R Block paid Thomas’s
2006 and 2007 EOS compensation more than ten days
after it was earned. Accordingly, if EOS compensa-
tion constitutes wages, Thomas’s 2006 and 2007 EOS
compensation was late, rendering her eligible for
statutorily-provided liquidated damages and attorney
fees. See IND. C ODE § 22-2-5-2.
Thomas sued H&R Block for violating the Wage
Payment Statute, alleging that it failed to pay EOS com-
pensation within ten days after it was earned. H&R
Block moved for summary judgment on the ground
that EOS compensation is not a wage under Indiana’s
Wage Payment Statute, and thus that it is not subject to
6 No. 10-1482
the Ten-Day Rule. Thomas moved for class certification
before the motion for summary judgment, but the
district court stayed the class certification issue so it
could first decide the motion for summary judgment. The
district court granted H&R Block’s motion. Thomas
appeals from that decision.
II. Analysis
A. “Wages” Under Indiana Law
We review de novo a district court’s decision to grant
summary judgment, “construing all facts and inferences
in the light most favorable to the party opposing the
motion. We will affirm if the summary judgment record
shows that ‘there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as
a matter of law.’ ” Bio v. Fed. Express Corp., 424 F.3d 593,
596 (7th Cir. 2005) (citing FED. R. C IV. P. 56(c)).
When addressing a question of state law while sitting
in diversity, “our task is to ascertain the substantive
content of state law as it either has been determined by
the highest court of the state or as it would be by that
court if the present case were before it now.” Woidtke v. St.
Claire Cnty., Ill., 335 F.3d 558, 562 (7th Cir. 2003)
(internal quotation marks and citation omitted). If the
state’s highest court has yet to rule on an issue, “decisions
of the state appellate courts control, unless there are
persuasive indications that the state supreme court
would decide the issue differently.” Research Sys. Corp. v.
ISPOS Publicite, 276 F.3d 914, 925 (7th Cir. 2002).
No. 10-1482 7
Indiana’s Wage Payment Statute, IND. C ODE. § 22-2-5-1
et seq., requires employers to pay their employees’
“wages” within ten days of the date they are earned,
and allows employees to recover damages and attorney
fees from employers who pay late. See IND. C ODE. §§ 22-2-5-
1, -2; Naugle v. Beech Grove City Schs., 864 N.E.2d 1058,
1063 (Ind. 2007). Because the W age Paym ent
Statute does not define “wages,” Indiana courts look to
the closely-related Wage Claims Statute, which defines
wages as “all amounts at which the labor or
service rendered is recompensed, whether the amount
is fixed or ascertained on a time, task, piece, or com-
mission basis, or in any other method of calculating
such amount.” IND. C ODE § 22-2-9-1(b); see Highhouse
v. Midwest Orthopedic Inst., P.C., 807 N.E.2d 737, 739
(Ind. 2004).
As a preliminary matter, “[t]he name given to the
method of compensation is not controlling. Rather, we
will consider the substance of the compensation to de-
termine whether it is a wage and, therefore, subject to
the Wage Payment Statute.” Kopka, Landau & Pinkus v.
Hansen, 874 N.E.2d 1065, 1072 (Ind. Ct. App. 2007).
The Indiana Supreme Court explained that a particular
form of compensation is a wage under the Indiana
Wage Payment Statute if “it is compensation for time
worked and is not linked to a contingency such as the
financial success of the company.” Highhouse, 807 N.E.2d
at 740 (internal quotation marks and citations omitted);
see also id. at 739 (accepting the lower court’s test of
wages, which provided that “a bonus is a wage if the
8 No. 10-1482
bonus directly relates to the time that an employee
works, is paid with regularity, and is not dictated by the
employer’s financial success”). Applying this standard,
Indiana courts consider a variety of factors to guide
their determination of whether compensation similar
to EOS compensation constitutes a wage.
First, Indiana courts are more likely to find compensa-
tion a wage if it is “not linked to a contingency.” Naugle,
864 N.E.2d at 1067 (quoting Highhouse, 807 N.E.2d at
740); see also Harney v. Speedway SuperAmerica, 526 F.3d
1099, 1105 (7th Cir. 2008) (same). For example, compensa-
tion based on the performance of a company is less
likely be deemed a wage. See, e.g., Highhouse, 807 N.E.2d
at 740. Similarly, compensation is less likely to be a wage
if it is contingent on a company’s collection efforts. See
Hansen, 874 N.E.2d at 1074 (“It only takes one reason,
however, and here, as in Highhouse, the disputed compen-
sation was tied to collection rather than billing.”); see
also Highhouse, 807 N.E.2d at 740 (“[B]ecause High-
house’s bonus was based on collections for his services,
not billings, substantially more than ten days after the
services were performed might well be needed before
the bonus amounts can be calculated.”). The Indiana
Supreme Court explained that payment contingent on
factors outside of an employee’s or employer’s control
“is not consistent with the time constraints imposed by
the Wage Payment Statute.” Highhouse, 807 N.E.2d at
740; see also Harney, 526 F.3d at 1106. Relatedly, the
Indiana Supreme Court explained that compensation is
less likely to constitute a wage when it is difficult to
calculate and pay within ten days after it was earned. See
No. 10-1482 9
Highhouse, 807 N.E.2d at 740; see also Harney, 526 F.3d
at 1106. Thus, although parties cannot contract out of
the Ten-Day Rule, Indiana courts consider whether the
compensation agreement calls for payment more than
ten days after it was earned when determining
whether compensation is difficult to calculate and pay
within the ten-day period. See, e.g., Highhouse, 807 N.E.2d
at 740 (“An employer may not escape the Act by obtaining
the employee’s agreement that wages are not payable
within the statutorily prescribed times. But the provi-
sion for annual payments lends support to the view that
both parties recognize that frequent calculation and
payment was difficult if not impossible.”); Hansen, 874
N.E.2d at 1074 (“[H]ere, as in Highhouse, payments
were made on a schedule—i.e., monthly—indicating that
more frequent calculation and payment in compliance
with the Wage Payment Statute’s ten-day rule would
have been difficult, if not impossible.”).
Second, related to the first factor, Indiana courts
also consider whether the compensation “directly relates
to the time that an employee works.” Highhouse, 807
N.E.2d at 739; see also Naugle, 864 N.E.2d at 1067 (“[A]
bonus is a wage if it is compensation for time worked
and is not linked to a contingency such as the financial
success of the company.” (quoting Highhouse, 807 N.E.2d
at 740)); McCausland v. Walter USA, Inc., 918 N.E.2d 420,
426 (Ind. Ct. App. 2009); Hansen, 874 N.E.2d at 1072
(“[I]f compensation is not linked to the amount of work
done by the employee or if the compensation is based on
the financial success of the employer, it is not a ‘wage.’ ”).
10 No. 10-1482
Third, Indiana courts consider whether wages are
paid on “a regular periodic basis for regular work done
by the employee.” Hansen, 874 N.E.2d at 1072 (quoting
Gress v. Fabcon, Inc., 826 N.E.2d 1, 3 (Ind. Ct. App. 2005));
see also Highhouse, 807 N.E.2d at 739. Thus, when a par-
ticular form of compensation is paid annually, it is less
likely to be considered a wage. See, e.g., Manzon v.
Stant Corp., 138 F. Supp. 2d 1110, 1114 (S.D. Ind. 2001).
Fourth, Indiana courts consider whether the compensa-
tion in question is paid in addition to wages. In Gress, for
example, an employee was paid on both a salary and
commission. 826 N.E.2d at 2. He was eligible to receive
commission payments on a monthly basis; these pay-
ments represented advances on his commissions that
he was required to return if his projects were less
profitable than anticipated. Id. The court held that the
commission payments were not “wages,” even though
they were paid monthly, because the commission
program was based on the profitability of each sales-
person’s individual projects, and thus “[t]he payment
of commissions was not directly linked to the amount
of work performed,” and because of “the length of
time involved in determining the final commission,”
which made it “impossible . . . to know what Gress was
owed within ten days.” Id. at 4.
In Prime Mortgage USA, Inc. v. Nichols, 885 N.E.2d 628
(Ind. Ct. App. 2008), the Court of Appeals of Indiana
expressly indicated that whether commissions are
paid in addition to salary is relevant to determining
whether commissions are “wages.” In Nichols, the court
No. 10-1482 11
noted that Indiana courts generally treat commissions
as wages. 885 N.E.2d at 664. It held that commissions
were “wages” where, other than car allowance and con-
tinued monthly payments of an annuity, the employee’s
compensation was composed solely of commissions,
was paid on a regular, monthly basis, and could be cal-
culated immediately. Id. at 663-65. It issued its holding
in spite of the fact that the commissions were contingent
on the employer’s financial success. Id. at 663-64. But it
explained that the commission “was not an amount in
addition to her normal compensation; [the commission]
was her normal compensation.” Id. at 664 (emphasis added).
In distinguishing Gress, the court in Nichols explained
that “Nichols’s compensation could be determined im-
mediately,” and that “the employee in Gress received
a base salary plus commission, while Nichols received
only a commission.” Id. at 664. Gress and Nichols indicate
that Indiana courts consider, at least to some extent,
whether a particular type of compensation is an em-
ployee’s sole form of compensation, or whether it is paid
in addition to a more regularly-paid salary.
Guided by these factors, we conclude that the EOS
compensation is not a wage under the Wage Payment
Statute. First, Thomas’s EOS compensation was “depend-
ent on other factors than [her] efforts,” since a portion of
the EOS compensation was based on the contingency of
collecting from customers. Naugle, 864 N.E.2d at 1067;
see also Highhouse, 807 N.E.2d at 740; Hansen, 874 N.E.2d
at 1074. Not to mention, Atkinson’s testimony indicates
that it was at least difficult, if not impossible, to calculate
12 No. 10-1482
EOS compensation within the ten-day period, see
Highhouse, 807 N.E.2d at 740; Hansen, 874 N.E.2d at 1074,
and the Sheet, providing that H&R Block would pay
EOS compensation on a date after the expiration of the ten-
day period, “or as soon thereafter as is reasonable
under the circumstances,” demonstrates the parties’
understanding and expectation that the calculation and
payment of the EOS compensation would likely take
more than ten days, see Highhouse, 807 N.E.2d at 740;
Harney, 526 F.3d at 1106. Second, Thomas’s EOS compensa-
tion was not directly related to the time she worked.
Since EOS compensation was partially based on collec-
tions, Thomas theoretically could have worked for an
entire tax season without earning any EOS compensa-
tion. See Gress, 826 N.E.2d at 4. Third, H&R Block paid
EOS compensation annually, at the end of every tax
season, and not on a regular, periodic basis. See, e.g.,
Manzon, 138 F. Supp. 2d at 1114. Finally, as explained
in more detail below, H&R Block paid Thomas an
hourly wage in addition to EOS compensation.
Thomas’s arguments on appeal are unavailing. First,
she argues that EOS compensation is a wage because it
is composed entirely of commissions, and because
Indiana Code § 22-2-9-1(b) unambiguously includes
“commission” in the definition of wages. To establish
that EOS compensation represents commissions, she
argues that testimony from H&R Block’s employee re-
ferring to EOS compensation as a commission permits
the inference, which we must accept on a motion for
summary judgment, that the EOS compensation is a
commission, and thus a wage. The fact that H&R Block
No. 10-1482 13
chose to pay commission at the conclusion of the tax
season, she argues, does not transform it from a series of
wage payments into a bonus. As general matter, however,
the substance of the compensation, and not its label, guides
our analysis. Hansen, 874 N.E.2d at 1072. Further,
Thomas’s argument begs the question and ignores case
law in both state and federal courts indicating that com-
missions do not always constitute “wages.” See, e.g.
McCausland, 918 N.E.2d at 424-46; Gress, 826 NE.2d at 4.
We are in no position to apply the statutes without
looking to case law interpreting them. See Woidtke, 335
F.3d at 562 (“[O]ur task is to ascertain the substantive
content of state law as it either has been determined by
the highest court of the state or as it would be by that
court if the present case were before it now.” (internal
quotation marks and citations omitted)). In light of the
authorities discussed above, Thomas’s argument fails.
Consistent with her argument that her compensation
was exclusively composed of commissions, Thomas
advances the position that her salary was merely a draw
on her commission. She, thus, argues that she did not
receive a wage in addition to her EOS compensation.
She relies on testimony from an H&R Block employee
characterizing the hourly wage as a draw. Since EOS
compensation is paid only to the extent that various
specified amounts exceed hourly wages, it is possible
for Thomas to argue that her salary was in part a draw
on her commission. But she cannot suggest that her
wages were completely drawn from her commissions:
She could have earned no commission and still received
14 No. 10-1482
the same hourly wage without having to repay H&R
Block. Further, only a portion of Thomas’s hourly wages
factored into calculating her EOS compensation. EOS
compensation is, at least in part, a form of compensation
that H&R Block paid in addition to hourly wages.
Finally, Thomas argues that collecting on sales should
not be considered a contingency for the purpose of deter-
mining whether compensation is a wage, and that
Indiana case law to the contrary is incorrect. She first
points to case law indicating that commissions are
wages. See, e.g., J Squared, Inc. v. Herndon, 822 N.E.2d
633 (Ind. Ct. App. 2005). She next argues that Hansen
misinterprets Highhouse when it cites to Highhouse
as support for its holding that collection efforts can con-
stitute a contingency for the purpose of determining
whether a compensation is a wage. 874 N.E.2d at 1074.
She further argues that collection efforts cannot con-
stitute such a contingency because “commission” is in
the statutory definition of wages, IND. C ODE A NN. § 22-2-9-
1(b), and there can be no commission until collec-
tion is made. But Highhouse indicates that a company’s
performance is merely one example of a contingency,
807 N.E.2d at 740 (“A ‘bonus’ is a wage if it is compensa-
tion for time worked and is not linked to a con-
tingency such as the financial success of the company.”
(emphasis added) (internal quotation marks and cita-
tions omitted)), and it expressly references the fact
that “Highhouse’s bonus was based on collections for
his services, not billings” in concluding that Highhouse’s
bonus was not a wage. Id. at 740. The Indiana Supreme
Court has not limited the relevant contingencies to busi-
No. 10-1482 15
ness performance, and imposing such a limit would
be contrary to Indiana case law.
B. Certification
Thomas asks us to certify to the Indiana Supreme
Court the question of whether the EOS compensation is
a wage under Indiana law. When determining whether
to certify a question, “[t]he most important considera-
tion guiding the exercise of this discretion . . . is
whether the reviewing court finds itself genuinely uncer-
tain about a question of state law that is vital to a correct
disposition of the case.” State Farm Mut. Auto. Ins. Co. v.
Pate, 275 F.3d 666, 671 (7th Cir. 2001) (citations omitted).
We have also explained that “certification is appropriate
when the case concerns a matter of vital public concern,
where the issue will likely recur in other cases, where
resolution of the question to be certified is outcome
determinative of the case, and where the state supreme
court has yet to have an opportunity to illuminate a
clear path on the issue.” Id. at 672 (citations omitted);
see also 7th Cir. R. 52(a); Ind. R. App. P. 64 (providing
that federal courts may certify a question of law to the
Indiana Supreme Court when it appears that the case
“presents an issue of state law that is determinative
of the case and on which there is no clear controlling
Indiana precedent”). We consider a variety of additional
factors when determining whether to certify a question,
see Pate, 275 F.3d at 671-72, but “[q]uestions that are
tied to the specific facts of a case are typically not ideal
candidates for certification. Thus, if certification would
16 No. 10-1482
produce a fact bound, particularized decision lacking
broad precedential significance, certification is inappro-
priate.” Harney 526 F.3d at 1101.
This case does not warrant certification. First, it
involves the interpretation of a compensation program
that appears unique to H&R Block. Resolution of this
case would unlikely “have a far-reaching precedential
effect for others.” Id. Second, the Indiana Supreme Court
has provided guidance on this issue that assists us in
resolving this dispute, most recently in Highhouse. We
decline to certify such a fact-specific question, especially
in light of Indiana case law addressing issues similar to
the issue this case presents.
III. Conclusion
For the foregoing reasons, we A FFIRM the district court.
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