If you run a business, you need to accept that you will probably face a commercial dispute at some point. Aside from eating up your time and causing stress, these can harm your reputation and cost you a lot of money, even if you win.
Here are some steps you should take:
Tell your insurer
If you are hoping they will cover any costs you might face, you need to inform them promptly. Delaying could lead to them refusing to pay.
Decide who will deal with the matter
You do not need your whole company distracted by this and letting anyone get involved could worsen your situation. Decide on a team and make sure everyone else knows to defer any calls or requests to them.
To fight a claim, you will need to support your argument with evidence. Start gathering it now to avoid anything being lost. If you do not already have everything backed up, get it done as some members of your workforce might try to destroy evidence to exonerate themselves or in a misguided attempt to protect the company.
Remember, it is a legal matter
However absurd the claim against you may seem, if someone is threatening legal action, you need to take it seriously. Getting help to review your contracts, understand your position, and how the relevant laws work is crucial. Only then can you start to define a strategy to give you the best possible outcome – whatever that might look like.