It's not theater, it's defense against aggrievement. Termination is a traumatic event that threatens your ability to exist or provide for dependents. People [rightfully] don't handle exile well.

Someone with an interest in scuttling your company could just as easily maintain a low profile and do it at any time. Termination forces execution into a more-predictable timeframe. Once notified, the malevolent only have opportunity to exfiltrate or sabotage whatever they can reach in the time it takes to walk them out the door.

European laws require us to give people something like two months' notice. Even then we don't trust them; we pay them their salary and tell them to stay home.