Distribution Options for Leased Employees?

[Susan S.]

An employer with leased employees sponsors a 401(k) plan and, in addition to that plan, the leased employees are also participants in the 401(k) plan of the leasing organization.  The employer has decided to terminate it's plan and will not be replacing it, but the leased employees will continue to participate in the leasing organization's plan.  Are the leased employees entitled to make a distribution election, or is the employer considered to "maintain" the leasing organization's plan and the balances must automatically be transferred to the leasing organization’s plan?