As discussed in
Bug 40541 - ical notifications box not functioning is this working for anyone?
I was told it would work in 5.0.19 but upgrading didn't help.
Note that the notification box does kind of work if you have a local calendar ("On My Mac"). But I
don't want my users to have local calendars--it would just lead to confusion as they put meetings in a place that doesn't sync with the server or affect their free/busy.