If nobody is even willing to take it to court to try to test it, then it sounds like it is working as an amazingly effective lawsuit shield to me. No company wants to defend anything in court, they want to never go to court.

I don’t think there really is anything to test in court here though. In the US generally all an employer needs to show is that an employee was fired for a valid job-related-reason of some kind, and not for the quite narrow set of reasons that would make it illegal. All a PIP does is make sure managers/supervisors are documenting reasons properly, while at the same time showing the employee that they have documented reasons that they would show should it ever go to court. Plus, the added benefit of being able to tell the court “See, we even tried to help them improve before we fired them.” Unless the employee has unambiguous hard evidence of an “actual” reason for firing that was not legal, then there really is nothing to take to court.

That all applies to non-contract employment in US only of course, and I am not familiar with all states just those I have worked in, so there could be some states where it’s more complicated.