Black immigration officers are struggling to pass promotion exams because the tests are racist, a court has heard.
A group of 49 Home Office employees is now set to sue the Government over claims that the exams are discriminatory.
They have all failed the Core Skills Assessment test, which according to a report by a firm of occupational psychologists is significantly harder to pass if you are non-white or aged over 35.
According to their analysis the pass rate for non-white employees is just 40.3 per cent of that of white candidates.
In a ruling which experts say will make it easier for employees to claim "disguised" discrimination in the workplace, the Supreme Court said on Wednesday that the group did not have to show why they had failed the test in order to bring their case.
Firms have examined the test, which employees needed to pass to be promoted to the Civil Service role of Executive Officer, but none have been able to work out why non-white and older people fail it more often.
The group will now sue the Government for compensation in the Employment Tribunal.
The Home Office argued that the employees needed to show why the test was discriminatory, but in a unanimous Supreme Court decision read by deputy president Lady Hale this was overruled.
"The applicants claimed that requiring them to pass the test put them at a particular disadvantage compared with younger, or white candidates, so it would be unlawful unless it could be justified," she said.
Kate Lea, employment rights solicitor at law firm Thompsons, which acted for the employees, said: “This decision will help workers challenge disguised discrimination in the workplace.”
Lawyers said the case meant employees could more easily bring a discrimination case under human rights law if they failed a test, as long as they could show that members of the same "protected" group were more likely to fail.
Mike Hibbs, head of employment law at Shakespeare Martineau, said: "One of the implications is that as an employer, if you're going to do some blanket testing then you need to set down and think about whether that could have a discriminatory effect on a particular class of people."
Businesses can only justify tests which mean employees are discriminated against "indirectly" if they are necessary for a particular role.
For example, they could claim that an English test is necessary when hiring a secretary or call centre worker, but might struggle to do so if hiring backroom staff who would not need to communicate clearly as part of their job.
Mr Hibbs suggested that employers should keep on file the reasons why they tested candidates on skills such as English, in case one of them later brought a discrimination case.
Jason Braier, an employment law barrister at Field Court Chambers, said: "This case re-crystallises that employees have to be careful to consider whether or not a test is going to place any group at a disadvantage."
A Home Office spokesman said: “We are disappointed by the Supreme Court’s decision on this preliminary issue.
"The claims brought relate to an internal skills assessment that has not been used since 2013 and the Home Office continues to do all it can to promote equality and fairness in the workplace.”