Earlier quoted context omitted.
So, instead, you pick up the can, and have a stern talk with the guy, have him sign some paperwork, and move on. Later, the guy makes untoward comments to someone on a PIP. You don't find out he did this until after you terminate the PIP person, and they sue you. Right in the middle of your next fundraising effort.
I personally believe that short of committing a felony, every employee gets a warning first. I'm not going to be held hostage by the abstract threat of frivolous lawsuits. And yes, with everything including the PIP being documented, that would be a frivolous lawsuit.
If your firm has any money in the bank at all, the accuser's lawyer will take the case on contingency, knowing both that you are unlikely to prevail and that your likelihood of prevailing is besides the point because the case will cost a fortune to litigate and taken years to dispose of, during which time you will be frozen on any major business development moves.
You can call these kinds of suits "frivolous" or "unfair" or anything else you'd like. I don't care, as long as you don't also call them "ineffective".
I think there are better places for employees to learn basic standards of professional conduct than in a deposition.