What Should You Do If Your Company Is Suited?

When you take the right steps to protect your business, you not only reduce financial risk, but also gain security.

Most business owners are more concerned with selling, running people, and maintaining cash flow than any other aspect of their business. However, there are inevitable situations when you are faced with a lawsuit once in your life while running your business and it can be devastating. Without adequate legal knowledge, litigation can seem stressful to you as it can affect your financial health. Why Are Small Businesses Being Sued?

There are two common reasons companies are threatened with lawsuits:


You can sue your customers for various reasons: Either they do not receive the promised services or products or they have injured themselves on your company premises. Even if you have a customer-friendly or transparent policy, the likelihood of a lawsuit is high. People will bring charges against your small business for the following reasons:

  • Rejection of customer service claims
  • Personal injury in business premises
  • Discrimination


Although many small business owners treat their employees fairly by creating a close and close bond as this is one of the keys to running a successful business, there are still dissatisfied employees who feel they are not getting what they deserve. If they feel abused, filing a lawsuit against the company is the way to alleviate the situation. According to a study conducted by Hiscox, every fifth small business is sued and fees associated with the litigation can reach $ 125,000. When these cases go to court, 25% result in a court verdict that causes the company to surrender half a million dollars or more.

Photo by Ashim D’Silva on Unsplash

Employees are tempted to sue if they feel they have been given an unjustified notice or have been disciplined. These lawsuits are often a way for them to make up for any loss of income they suffered through the actions of their employer. Your company will also be sued if employees believe you did not do your part to alleviate the situation. The most common types of employee complaints are:

  • Employee Injury
  • Discrimination in the workplace
  • Wage and salary violations
  • Harassment in the workplace
  • Unjustified termination
  • Employee Injury

What to do if you are faced with a legal dispute

Talk to your lawyer right away

Once you learn that you have been sued, immediately contact your lawyer before you can take any formal action so that you can take the best steps to reduce the gravity of the situation. Your attorney will help you handle this case properly to prevent the harm from worsening. They also give you insight on how to approach the person if they are threatened with a lawsuit and advise you not to contact the person directly.

Gather all the information you need

You must also keep full records of the entity or person who threatens to bring charges against you. The court will ask you to provide evidence during the trial.

Contact your insurer

You will also need to speak to your insurer so that you know how to properly file a liability claim.

No panic

Facing a lawsuit can be nerve-wracking, but knowing you haven’t committed a crime should keep your focus on running your business. Taking the right and lawful steps will protect your business from all of the financial risks associated with litigation.

This will reduce the risk of legal action

Reduce the financial impact

When litigation becomes inevitable, minimize financial threats by integrating your business in a way that protects your personal finances from claims. You can do this by purchasing public liability insurance that will protect your finances. General liability insurance is also important, as it covers a wide range of possible damage.

Be careful what you say and do to your co-workers and customers

You can get into trouble because you over-promise or make exaggerated claims about your skills and your business. Avoid saying anything, in private or public, that could haunt you for the rest of your life. Avoid making claims about your products or services that may be challenged in the future.

Find competent legal help

If you ever get into a situation where your clients or employees have put you in legal hot water, you need an informed and reputable attorney to advise you. If legal issues arise, this is the person you should contact to avoid the possibility of a full blown lawsuit.

The bottom line

When you take the right steps to protect your business, you not only reduce financial risk, but also gain security. Know your rights as a business owner so you can protect your business from serious legal matters.

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