Dollar General has suffered another setback in its attempt to beat back a long-running federal investigation into job screening practices allegedly set up to screen out African American applicants, as a Chicago federal judge ruled the Equal Employment Opportunity Commission didn’t overstep in initiating an enforcement action against the retailer, even after the federal agency pulled the plug on the required pre-enforcement settlement process.

On April 10, U.S. District Judge Andrea Wood again sided with the EEOC over Dollar General in the discrimination enforcement action, which has continued against the company in some form since 2011.

“The Court concludes that EEOC’s notice provided Dollar General with enough information for Dollar General to investigate the allegations,” Judge Wood wrote in her decision. “Dollar General knew that the EEOC’s allegations related to Black applicants and employees that were not hired, not considered for employment, or discharged due to failing a background check. Furthermore, Dollar General knew two of the complainants.

This was enough to put Dollar General on notice of what it had allegedly done and to enable it to investigate for itself whether there was any wrongdoing.”

Wood’s latest ruling marked the next steps in the litigation first brought by the EEOC in federal court in 2013 against the Goodlettsville, Tenn.-based discount retail chain. In its complaint, the EEOC alleged Dollar General’s hiring practices, and particularly its use of criminal background checks to screen job applicants, has caused a disparate impact on African-American job applicants.

The EEOC has alleged Dollar General also deployed a slew of other screening processes to block out most black applicants, including a so-called “Desired Behavior Assessment,” credit checks, reference tests and drug tests.

The EEOC launched the enforcement action against Dollar General two years earlier, acting first on regulatory complaints filed by two black former Dollar General employees, who accused the retailer of discriminating against them when they were fired.

However, the investigation of those complaints later expanded to focus more broadly on the company’s job screening practices – a broadening of the scope of the investigation Dollar General has steadfastly resisted.

In 2015, Judge Wood denied a Dollar General request to require the EEOC to hand over various reports and databases and other documents the retailer believed the agency had relied upon to determine the company’s screening practices may have violated federal law.

And now, the judge also turned aside the company’s attempt to argue the EEOC action was not valid because the scope of the inquiry had gone far beyond the charges that had initially launched the action.

Citing case law established in the 2005 Seventh Circuit Court of Appeals decision in EEOC v. Caterpillar, the judge noted the EEOC is empowered under the law to act on “any violations that the EEOC ascertains in the course of a reasonable investigation of the charging party’s complaint.”

“’The charge incites the investigation, but if the investigation turns up additional violations the Commission can add them to its suit,’” Wood wrote, citing the Caterpillar decision. “Thus,” she added, “Dollar General’s focus on the charges of discrimination is misplaced here, as it is the EEOC that is bringing suit against Dollar General and not private parties.”

Judge Wood also shot down Dollar General’s attempt to argue the EEOC had not done enough to settle the case before filing suit.

The retailer had pointed to requirements in federal civil rights law mandating the agency engage in a “conciliation” process with an accused employer before formally launching an enforcement action.

And Dollar General said the EEOC had shortcircuited that process by not providing documentation the company believed was required to “provide adequate notice of the allegations,

 and by walking away from what the company said was an ongoing conciliation discussions in 2012.

The judge said she believed the EEOC had provided sufficient explanation concerning the nature and scope of its investigation.

And the judge said her ability to review the EEOC’s conciliation process “is extremely narrow.”

“Here, it is undisputed that, between September 6, 2011 and July 26, 2012, the EEOC and Dollar General engaged in written and oral communications regarding the alleged discrimination,” the judge wrote.

She noted earlier in the decision that the EEOC had, at that point, determined the conciliation process was not producing an “acceptable” settlement.

“And that is where the scope of this Court’s review ends,” she wrote.

Dollar General is represented in the action by attorneys with the firm of McGuireWoods LLP, with offices in Dallas and Chicago.

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