To put it other way, if your employee did something wrong, and you have a reason, you better fire him "without reason", or will face a discrimination case otherwise.
Good documentation is important. Firing with cause does happen and should, unfortunately, happen in some cases. Letting someone go for repeatedly making inappropriate remarks to clients or for repeatedly playing costly pranks on other staff (depending on the business and the work environment), among others, are reasons that, if you have documentation of individual events, firing with cause happens. General laziness could also be a cause, provided there were concrete examples of failing to fulfill a job description.
Why would a company bother? Unemployment benefits come out of a "tax" paid by the individual company--when the unemployment benefit account for a company is depleted when someone is let go without cause, they have to pay into it again. If someone needs to be fired, firing him or her with cause is the best way to ensure the financial stability of the company IF you have documentation.
God help those who do not help themselves. -- Wilson Mizner