Older workers bear the burden of proof to show age was key reason they were fired or demoted.
The US Supreme Court has made it more difficult for employees age 40 and older to sue their bosses for age discrimination.
In a 5-to-4 ruling announced Thursday, the majority justices rejected the use of an elaborate burden-shifting mechanism that often favors plaintiffs in civil rights cases.
Instead, the high court said workers suing under the Age Discrimination in Employment Act (ADEA) must fight their legal battles the usual way, by presenting enough evidence to convince a judge or jury of the illegal activity.
The court added that to win an ADEA case, an employee must be able to prove not just that age played a role in an adverse employment decision, but also that it had a "determinative influence."
The decision, in Gross v. FBL Financial Services, is timely because it comes amid a prolonged economic downturn with many older workers under extreme pressure facing workplace downsizing.
"We hold that a plaintiff bringing a disparate-treatment claim pursuant to the ADEA must prove, by a preponderance of the evidence, that age was the 'but-for' cause of the challenged adverse employment action," wrote Justice Clarence Thomas in the majority opinion.
In a dissent, Justice John Paul Stevens called the majority opinion "an unabashed display of judicial lawmaking."
He said the majority justices were adopting a "crabbed" interpretation of the age discrimination law. He said the majority was disregarding prior high court precedent and congressional intent.
In adopting a narrow reading of the ADEA, Justice Thomas said the court was justified in refusing to apply the same burden-shifting framework established in Title VII of the Civil Rights Act to the age discrimination law.