Unfortunately, this switch is a problem.  When the trunk lid is closed, it just barely pushes it far enough to break contact and turn the lights off.  If the trunk lid has been adjusted a bit on its hinges or the switch panel has been bent downward a little, it might not turn off at all.  The lights staying on with the trunk closed will kill the battery in a couple of days.  When an owner is trying to figure out why his battery goes dead, he typically opens the trunk and disconnects the trunk lights because he can't have them on while he's trying to find the drain -- not realizing he has just disconnected the drain!

You can't easily see if the lights go out when the trunk is closed unless you're willing to climb in the trunk and close it on yourself -- not recommended.  Some owners have actually installed a third trunk light somewhere they can see it -- like on the dashboard!  There are usually a couple of unused wires in the harnesses, so they just connect one to the lights in the trunk and another to an unused indicator in the dash so they know if their trunk light is on -- or flickering when they drive over a bump, or some such.

It is easier to simply fix the problem.  In any hardware or building supply store, you can buy a package of hard plastic stick-on furniture feet.  They come in packages of four, which will leave you with three spares.  Just peel off the back and stick one on the bottom of the trunk lid so it contacts the button.  This will add about a quarter inch to the pushing of the button.  On Palm's car, this actually makes the lights turn off soon enough that you can see them turn off while the lid is still about an inch from fully closed.

Jaguar apparently came up with the same fix.  On Stephen Edward Haley's '89, there is a screwed-on plastic part that pushes the button:

If you can find a part number for that little plastic doohickey, it should fit the earlier cars -- but, frankly, installing the furniture foot is easier and works just as well.  And doesn't require drilling holes for screws.