Are employees of a company that uses a PEO considered to have terminat

[Guest kstorch]

With regard to an employer that is utilizing a PEO for employee benefits, should that employer decide to leave the PEO and take the benefits in house, how does that affect the PEO's 401(k) plan? Are the employers employees considered having "Terminated Service" in which case they could remove money from the PEO as a rollover or have the employees not terminated service in which case the employer could spin off a new plan from the PEO?