A little off topic, but ...
This thread is proof that the server loses no matter what {but in the OP case he got a $20.

} Free-meal-programs bring in people that don't leave tips, make a mess, require a lot more attention and front-line having to deal with stupid policies like this one. Restaurants want the sale and actually don't care much if the server gets a tip.
Table of eight comes in. two in high chairs, four seated kids and two adults. Four free meals, four the cheapest entree. No problem to me, they meet the deal and the restaurant has a customer. Guess what the table and floor looks like? Guess how much extra time to serve? Guess who ate the meals? I never had a policy like the OP's restaurant to deal with. Oh yeah, guess what my tip was?
Anecdotal? Maybe.
*Every restaurant runs differently on how tips are split or shared and also how labor is split and shared, so my experience is not universal.
** Have more to say but I have to get back to work ...