It does not act as a switch. The way it usually works, as mentioned by OJFord, is that wall sockets have safety shutters on the live and neutral connectors, which open when the earth pin is inserted in the earth connector in order to prevent a plug without earth from being connected. That's why sockets always have an earth pin even if only plastic on some cheap ones (for double insulated devices that do not require an earth connection).

Pretty cool feature.