If you are asking about the electrical connection on the Thermostat housing -- that is your 100 degree switch (there may be a more formal name for it). If you still have a functioning stock (factory) ignition system for a later 280sl with transistorized ignition, two-way vacuum valve, stock distributor etc., then this switch triggers the system to advance the distributor at idle in order to raise the RPM a bit to help cool the car. It triggers at 100 degrees celsius if I recall correctly.
So the need depends on your set-up. Many cars have this disconnected as they no longer have a fully functioning stock system.