OS X Server Users Read & Write but can't delete
Select the containing folder in Server.app, then Edit Permissions….
Click the gear icon at the bottom of the sheet, then select Make Inherited Entries Explicit.
Change the permissions as you desire (the users should no longer be greyed out), then click OK.
With the containing folder still selected, click the gear icon at the bottom of the window and click Propagate Permissions….
Select all the option boxes, then click OK.