AMENDMENTS RELATED TO TITLE XI OF THE REFORM ACT.

SEC. 7861. AMENDMENTS RELATED TO TITLE XI OF THE REFORM ACT. (a) Amendments Related to Section 1113 of the Reform Act.— 103 STAT. 2430 (1) Section 203(a)(2) of ERISA is amended— (A) by striking “following” the first place it appears, and (B) by striking “414(f)(1)(B)” in subparagraph (C)(ii)(I) and inserting “3(37)(A)(ii)”. (2) Section 1113(e)(3) of the Reform Act is amended by striking “Section 202(B)(i)” and inserting “Section 202(a)(1)(B)(i)”. (3) The second subsection (e) of section 1113 of the Reform Act is redesignated as subsection (f). (4) Section 1113(f) of the Reform Act, as redesignated by paragraph (3), is amended by adding at the end thereof the following new paragraph: “(4) Repeal of class year vesting.— If a plan amendment repealing class year vesting is adopted after October 22, 1986, such amendment shall not apply to any employee for the 1st plan year to which the amendments made by subsections (b) and (e)(2) apply (and any subsequent plan year) if— “(A) such plan amendment would reduce the nonforfeitable right of such employee for such year, and “(B) such employee has at least 1 hour of service before the adoption of such plan amendment and after the beginning of such 1st plan year. This paragraph shall not apply to an employee who has 5 consecutive 1-year breaks in service (as defined in section 411(a)(6)(A) of the Internal Revenue Code of 1986) which include the 1st day of the 1st plan year to which the amendments made by subsection (b) and (e)(2) apply. A plan shall not be treated as failing to meet the requirements of section 401(a)(26) of such Code by reason of complying with the provisions of this paragraph.” (5)(A) Section 411(a)(3) is amended by adding at the end thereof the following new subparagraph: “(G) Treatment of matching contributions forfeited by reason of excess deferral or contribution.—A matching contribution (within the meaning of section 40 Km)) shall not be treated as forfeitable merely because such contribution is forfeitable if the contribution to which the matching contribution relates is treated as an excess contribution under section 401(k)(8)(B), an excess deferral under section 402(g)(2)( A), or an excess aggregate contribution under section 401(m)(6)(B).”. (B) Paragraph (3) of section 203(a) of ERISA is amended by adding at the end thereof the following new subparagraph: “(F) A matching contribution (within the meaning of section 401(m) of the Internal Revenue Code of 1986) shall not be treated as forfeitable merely because such contribution is forfeitable if the contribution to which the matching contribution relates is treated as an excess contribution under section 401(k)(8)(B) of such Code, an excess deferral under section 4O2(g)(2)(A) of such Code, or an excess aggregate contribution under section 401(m)(6)(B) of such Code.”. (6)(A) Section 411(a)(4)(A) is amended to read as follows: “(A) years of service before age 18,”. (B) Subparagraph (A) of section 2O3(b)(1) of ERISA is amended to read as follows: “(A) years of service before age 18,”. (b) Amendment Related to Section 1132 of the Act.— 103 STAT. 2431 (1) Notwithstanding any other provision of law, in the case of any qualified pension plan and welfare benefit plan described in paragraph (2), the assets of such pension plan in excess of its liabilities may be transferred to such welfare benefit plan upon the termination of such pension plan if such assets are to be used to provide retiree health benefits. (2) For purposes of paragraph (1), a qualified pension plan and welfare benefit plan are described in this paragraph if— (A) both such plans are jointly administered pursuant to a collective bargaining agreement between the employer maintaining such plans and one or more employee representatives, (B) the welfare benefit plan provides retiree health benefits, and (C) the qualified pension plan has assets in excess of liabilities (determined on a termination basis) and the welfare benefit plan has assets which are less than the present value of the benefits to be provided under the plan (determined as of the time of termination of the pension plan). (3) For purposes of the Internal Revenue Code of 1986, any transfer of assets to which paragraph (1) applies shall be treated as a reversion of such assets to the employer maintaining the plan which is includible in the gross income of such employer and subject to the tax imposed by section 4980 of such Code. (c) Amendments Related to Section 1140 of the Reform Act.— (1) Subsection (a) of section 1140 of the Reform Act is amended by striking “or subtitle C” and inserting “, subtitle C, or title XVIII of this Act”. (2) Section 1140(c) of the Reform Act is amended by striking all after “the first plan year beginning” and inserting “after the later of” “(1) December 31, 1988, or “(2) the earlier of— “(A) December 31, 1990, or “(B) the date on which the last of such collective bargaining agreements terminate (without regard to any extension after February 28, 1986).” (3) Section 1140(c) is amended by adding at the end thereof the following new flush sentence: “For purposes of paragraph (1)(B) and any other provision of this title, an agreement shall not be treated as terminated merely because the plan is amended pursuant to such agreement to meet the requirements of any amendment made by this title or title XVIII of this Act.”. (d) Amendments Related to Section 1145 of the Reform Act.— (1) Subsection (f) of section 303 of the Retirement Equity Act of 1984 is amended by striking “July 24, 1984” and inserting “July 17, 1984”. (2) Paragraph (3) of section 205(b) of ERISA, as added by section 1145(b) of the Reform Act, is redesignated as paragraph (4).