§ 1081 TITLE 29—LABOR Page 406

amendment with respect to breaks in service

(which amendment is made or becomes effective

after January 1, 1974, and before the date on

which section 1053 of this title first becomes effective with respect to such plan) if such amendment provides that the nonforfeitable benefit

derived from employer contributions to which

any employee would be entitled is less than the

lesser of the nonforfeitable benefit derived from

employer contributions to which he would be entitled under—

(A) the break in service rules of section

1052(b)(3) of this title, or

(B) the plan as in effect on January 1, 1974.

Subparagraph (B) shall not apply if the break in

service rules under the plan would have been in

violation of any law or rule of law in effect on

January 1, 1974.

(f) The preceding provisions of this section

shall not apply with respect to amendments

made to this part in provisions enacted after

September 2, 1974.

(Pub. L. 93–406, title I, §211, Sept. 2, 1974, 88 Stat.

867; Pub. L. 99–272, title XI, §11015(a)(1)(B), Apr.

7, 1986, 100 Stat. 265; Pub. L. 101–239, title VII,

§§7891(a)(1), 7894(h)(2), Dec. 19, 1989, 103 Stat.

2445, 2451.)

REFERENCES IN TEXT

Section 1086(c) of this title, referred to in subsec.

(c)(1), was in the original ‘‘section 307(c)’’, meaning section 307(c) of Pub. L. 93–406, the Employee Retirement

Income Security Act of 1974. Section 307(c) was renumbered section 308(c) by Pub. L. 100–203, title IX,

§9341(b)(1), Dec. 22, 1987, 101 Stat. 1330–370.

This chapter, referred to in subsec. (c)(1), was in the

original ‘‘this Act’’, meaning Pub. L. 93–406, known as

the Employee Retirement Income Security Act of 1974.

Titles I, III, and IV of such Act are classified principally to this chapter. For complete classification of

this Act to the Code, see Short Title note set out under

section 1001 of this title and Tables.

The Internal Revenue Code of 1986, referred to in subsecs. (c)(1) and (d), is classified generally to Title 26, Internal Revenue Code.

Section 1017(d) of this Act, referred to in subsec. (d),

is section 1017 of Pub. L. 93–406, which is set out as an

Effective Date; Transitional Rules note under section

410 of Title 26.

AMENDMENTS

1989—Subsecs. (c)(1), (d). Pub. L. 101–239, §7891(a)(1),

substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue Code of 1954’’.

Subsec. (f). Pub. L. 101–239, §7894(h)(2), added subsec.

(f).

1986—Subsec. (c)(1). Pub. L. 99–272 made a technical

amendment to the reference to section 1086(c) of this

title to reflect the renumbering of the corresponding

section of the original act.

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by section 7891(a)(1) of Pub. L. 101–239 effective, except as otherwise provided, as if included in

the provision of the Tax Reform Act of 1986, Pub. L.

99–514, to which such amendment relates, see section

7891(f) of Pub. L. 101–239, set out as a note under section

1002 of this title.

Amendment by section 7894(h)(2) of Pub. L. 101–239 effective, except as otherwise provided, as if originally

included in the provision of the Employee Retirement

Income Security Act of 1974, Pub. L. 93–406, to which

such amendment relates, see section 7894(i) of Pub. L.

101–239, set out as a note under section 1002 of this title.

EFFECTIVE DATE OF 1986 AMENDMENT

Amendment by Pub. L. 99–272 applicable with respect

to applications for waivers, extensions, and modifications filed on or after Apr. 7, 1986, see section 11015(a)(3)

of Pub. L. 99–272, set out as an Effective Date note

under section 1085a of this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in section 1086 of this title.

PART 3—FUNDING

PART REFERRED TO IN OTHER SECTIONS

This part is referred to in sections 1060, 1103, 1132,

1201, 1202 of this title.

§ 1081. Coverage

(a) Plans excepted from applicability of this part

This part shall apply to any employee pension

benefit plan described in section 1003(a) of this

title, (and not exempted under section 1003(b) of

this title), other than—

(1) an employee welfare benefit plan;

(2) an insurance contract plan described in

subsection (b) of this section;

(3) a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a

select group of management or highly compensated employees;

(4)(A) a plan which is established and maintained by a society, order, or association described in section 501(c)(8) or (9) of title 26, if

no part of the contributions to or under such

plan are made by employers of participants in

such plan; or

(B) a trust described in section 501(c)(18) of

title 26;

(5) a plan which has not at any time after

September 2, 1974, provided for employer contributions;

(6) an agreement providing payments to a retired partner or deceased partner or a deceased

partner’s successor in interest as described in

section 736 of title 26;

(7) an individual retirement account or annuity as described in section 408(a) of title 26,

or a retirement bond described in section 409

of title 26 (as effective for obligations issued

before January 1, 1984);

(8) an individual account plan (other than a

money purchase plan) and a defined benefit

plan to the extent it is treated as an individual account plan (other than a money purchase plan) under section 1002(35)(B) of this

title;

(9) an excess benefit plan; or

(10) any plan, fund or program under which

an employer, all of whose stock is directly or

indirectly owned by employees, former employees or their beneficiaries, proposes

through an unfunded arrangement to compensate retired employees for benefits which

were forfeited by such employees under a pension plan maintained by a former employer

prior to the date such pension plan became

subject to this chapter.

(b) ‘‘Insurance contract plan’’ defined

For the purposes of paragraph (2) of subsection

(a) of this section a plan is an ‘‘insurance contract plan’’ if—
Page 407 TITLE 29—LABOR § 1082

(1) the plan is funded exclusively by the purchase of individual insurance contracts,

(2) such contracts provide for level annual

premium payments to be paid extending not

later than the retirement age for each individual participating in the plan, and commencing

with the date the individual became a participant in the plan (or, in the case of an increase

in benefits, commencing at the time such increase became effective),

(3) benefits provided by the plan are equal to

the benefits provided under each contract at

normal retirement age under the plan and are

guaranteed by an insurance carrier (licensed

under the laws of a State to do business with

the plan) to the extent premiums have been

paid,

(4) premiums payable for the plan year, and

all prior plan years under such contracts have

been paid before lapse or there is reinstatement of the policy,

(5) no rights under such contracts have been

subject to a security interest at any time during the plan year, and

(6) no policy loans are outstanding at any

time during the plan year.

A plan funded exclusively by the purchase of

group insurance contracts which is determined

under regulations prescribed by the Secretary of

the Treasury to have the same characteristics

as contracts described in the preceding sentence

shall be treated as a plan described in this subsection.

(c) Applicability of this part to terminated multiemployer plans

This part applies, with respect to a terminated

multiemployer plan to which section 1321 of this

title applies, until the last day of the plan year

in which the plan terminates, within the meaning of section 1341a(a)(2) of this title.

(d) Financial assistance from Pension Benefit

Guaranty Corporation

Any amount of any financial assistance from

the Pension Benefit Guaranty Corporation to

any plan, and any repayment of such amount,

shall be taken into account under this section in

such manner as determined by the Secretary of

the Treasury.

(Pub. L. 93–406, title I, §301, Sept. 2, 1974, 88 Stat.

868; Pub. L. 96–364, title III, §304(a), title IV,

§411(b), Sept. 26, 1980, 94 Stat. 1293, 1308; Pub. L.

101–239, title VII, §§7891(a)(1), 7894(d)(1)(A),

(4)(A), Dec. 19, 1989, 103 Stat. 2445, 2449.)

REFERENCES IN TEXT

Section 409 of title 26, referred to in subsec. (a)(7),

means section 409 of Title 26, Internal Revenue Code,

prior to its repeal by Pub. L. 98–369, div. A, title IV,

§491(b), July 18, 1984, 98 Stat. 848, applicable to obligations issued after Dec. 31, 1983.

This chapter, referred to in subsec. (a)(10), was in the

original ‘‘this Act’’, meaning Pub. L. 93–406, known as

the Employee Retirement Income Security Act of 1974.

Titles I, III, and IV of such Act are classified principally to this chapter. For complete classification of

this Act to the Code, see Short Title note set out under

section 1001 of this title and Tables.

AMENDMENTS

1989—Subsec. (a)(4)(A), (6). Pub. L. 101–239, §7891(a)(1),

substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue Code of 1954’’, which for purposes of codification was translated as ‘‘title 26’’ thus requiring no

change in text.

Subsec. (a)(7). Pub. L. 101–239, §7894(d)(4)(A), substituted ‘‘section 409 of title 26 (as effective for obligations issued before January 1, 1984)’’ for ‘‘section 409 of

title 26’’.

Subsec. (a)(8). Pub. L. 101–239, §7894(d)(1)(A)(i), struck

out ‘‘or’’ after semicolon at end.

Subsec. (a)(9). Pub. L. 101–239, §7894(d)(1)(A)(ii), substituted ‘‘; or’’ for period at end.

Subsec. (a)(10). Pub. L. 101–239, §7894(d)(1)(A)(iii), substituted ‘‘any’’ for ‘‘Any’’.

1980—Subsec. (a)(10). Pub. L. 96–364, §411(b), added

par. (10).

Subsecs. (c), (d). Pub. L. 96–364, §304(a), added subsecs.

(c) and (d).

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by section 7891(a)(1) of Pub. L. 101–239 effective, except as otherwise provided, as if included in

the provision of the Tax Reform Act of 1986, Pub. L.

99–514, to which such amendment relates, see section

7891(f) of Pub. L. 101–239, set out as a note under section

1002 of this title.

Section 7894(d)(1)(B) of Pub. L. 101–239 provided that:

‘‘The amendments made by subparagraph (A) [amending this section] shall take effect as if included in section 411 of the Multiemployer Pension Plan Amendments Act of 1980 [Pub. L. 96–364].’’

Section 7894(d)(4)(B) of Pub. L. 101–239 provided that:

‘‘The amendment made by subparagraph (A) [amending

this section] shall take effect as if originally included

in section 491(b) of Public Law 98–369.’’

EFFECTIVE DATE OF 1980 AMENDMENT

Amendment by Pub. L. 96–364 effective Sept. 26, 1980,

except as specifically provided, see section 1461(e) of

this title.

REGULATIONS

Secretary authorized, effective Sept. 2, 1974, to promulgate regulations wherever provisions of this subchapter call for the promulgation of regulations, see

section 1031 of this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1003, 1023, 1054

of this title.

§ 1082. Minimum funding standards

(a) Avoidance of accumulated funding deficiency

(1) Every employee pension benefit plan subject to this part shall satisfy the minimum funding standard (or the alternative minimum funding standard under section 1085 of this title) for

any plan year to which this part applies. A plan

to which this part applies shall have satisfied

the minimum funding standard for such plan for

a plan year if as of the end of such plan year the

plan does not have an accumulated funding deficiency.

(2) For the purposes of this part, the term ‘‘accumulated funding deficiency’’ means for any

plan the excess of the total charges to the funding standard account for all plan years (beginning with the first plan year to which this part

applies) over the total credits to such account

for such years or, if less, the excess of the total

charges to the alternative minimum funding

standard account for such plan years over the

total credits to such account for such years.

(3) In any plan year in which a multiemployer

plan is in reorganization, the accumulated funding deficiency of the plan shall be determined

under section 1423 of this title.