The US Supreme court ruled in favour of Samantha Elauf, a Muslim woman after she was turned down a job at Abercrombie & Fitch Co clothing store because she was wearing a hijab.
Elauf was denied a sales job at an Abercrombie Kids store in Tulsa, Oklahoma at the age of 17, according to Sky News.
The legal issue was whether Elauf was required to seek religious accomodation in order for the company to be sued under the 1964 Civil Rights Act. This bans employment discrimination based on religious beliefs and practices.
At the job interview, Elauf wore a hijab but did not state that as a Muslim she wanted the company to give her a religious accommodation.
The upmarket clothing company denied the 17-year-old the job on the grounds that wearing the head scarf violated its "look policy" for sales staff in two ways: it was black, and it was considered to be headwear.
A federal district judge had previously ruled for Elauf, but an appeals court was in favour of Abercrombie in October 2013.
However, America's highest court has voted 8-1 in favour of the US Equal Employment Opportunity Commission (EEOC) that sued the clothing company on Elauf's behalf.
"The EEOC applauds the Supreme Court's decision affirming that employers may not make an applicant's religious practice a factor in employment decisions," said EEOC chair Jenny Yang.
"This ruling protects the rights of workers to equal treatment in the workplace without having to sacrifice their religious beliefs or practices."
The clothing company has now changed its "look policy" to accommodate hijabs in the workplace.
Abercrombie also settled a lawsuit in 2004 brought by black, Hispanic and Asian-American college students for $40m, pledging to diversify its hiring practices.
The EEOC has reported that Muslims file more employment claims in the United States about discrimination and the failure to provide religious accommodations than any other religious group.