Partial Summary Judgment For Servers Over Tip Pool Paying AM Prep Workers

A federal court in Colorado granted partial summary judgment to servers who sued Perry’s Restaurants over a mandatory tip-pool distribution that diverted shared tips to morning "AM" prep workers scheduled before customer service began. The opinion, dated Feb. 3, 2026 and published Feb. 10, resolved part of the parties’ dispute in favor of the servers in Green v. Perry’s Restaurants (D. Colo.).

The decision targeted a tip-sharing scheme that included prep staff who punched in before doors opened to customers. Servers had challenged the pool as improperly allocating their tips to employees who worked pre-opening prep shifts rather than serving paying guests. By granting partial summary judgment, the court removed at least some legal questions from trial and sided with the plaintiffs on those specific claims.

The ruling matters for front-of-house staff and managers because it addresses who may be included in mandatory tip pools. Many restaurants rely on tip pools to distribute earnings among servers, bussers, and back-of-house support. Including staff who work exclusively in pre-opening food prep risks litigation under the theory advanced by the servers in this case. For employers, the ruling signals potential liability for tip-pool designs that reach employees who do not have direct customer-facing roles during service.

Operationally, restaurants that use similar pooling arrangements may need to review schedules and payroll practices. Managers may respond by changing who is eligible for pooled tips, restructuring shifts so AM prep workers overlap with service periods, or compensating prep labor through wages rather than tips. Those choices affect labor costs, back-of-house staffing, and the day-to-day division of tips that servers rely on to make a living.

The decision is limited to the partial summary judgment granted by the district court and does not necessarily end the litigation. Remaining factual or legal issues could proceed to trial, and the case may ultimately be subject to further appellate review. For workers, the ruling underscores that courts are scrutinizing how employers allocate tipped income and that tip-pool recipients and timing of shifts are key fault lines in these disputes.

For servers and restaurant operators, the takeaway is practical: revisit tip-pool policies, document job duties and shift times for AM prep staff, and consult counsel before continuing mandatory tip-sharing that includes pre-opening personnel. The outcome in Green v. Perry’s Restaurants could prompt more employers to change pooling arrangements or strip pre-opening prep workers from tip pools to avoid similar challenges.