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Air Berlin was forced to cancel flights for a second day today after pilots again called in sick in unusually high numbers, potentially complicating efforts to rescue the insolvent carrier, Reuters reported. Air Berlin, Germany’s second-biggest airline, is set to be carved up, most likely among several buyers, with binding offers due this Friday. The airline filed for bankruptcy protection last month after its biggest shareholder, Etihad Airways, withdrew funding following years of losses. However, those losses are mounting as more plans are grounded. Air Berlin said that it had cancelled 32 flights today after around 150 pilots called in sick. On Tuesday, Air Berlin had scrapped about 100 flights. Some short-haul flights at Lufthansa’s budget airline Eurowings are also affected because it leases 33 planes with crews from Air Berlin. Air Berlin has already said the cancellations threatened its existence and could force it to shut down, jeopardising negotiations with potential investors and costing it several million euros a day.

Roughly 34,000 union members who work for United Parcel Service Inc. and other logistics companies in New York will decide on Wednesday whether to accept deep pension cuts in what could be the start of a wave of benefit reductions to shore up union retirement plans, Reuters reported yesterday. If approved, pensions for retired teamsters from nine New York local unions will be cut 29 percent, which the plan’s trustees have said will lower the typical monthly benefit for a retiree with 30 years service to $3,550 from $5,000. The New York State Teamsters Conference Pension and Retirement Fund in August became the third multiemployer plan, and by far the largest, to receive U.S. Treasury approval for a rescue plan under the Multiemployer Pension Reform Act of 2014. MPRA allows underfunded multiemployer plans to cut benefits, within certain limits, if the trustees can show it will prevent insolvency. As many as 114 multiemployer pension plans covering 1.3 million workers are at risk of running out of money in 20 years, according to actuarial consulting firm Cheiron Inc.

Chicago’s cash-strapped school district is set to receive an additional $1.1 billion from Illinois over the next five years alone to pay for its teachers’ pensions, providing significant relief from the escalating costs that have reduced its bond rating to junk, Bloomberg News reported on Friday. The changes to how aid is distributed, ushered in by legislation Republican Governor Bruce Rauner signed on Thursday, triggered a rally in Chicago school bonds, pushing the price of some securities to a more than two-year high. The amount to be provided by the state marks an 18-fold increase from the $62 million it had previously been set to pay into the teachers fund, according to pension documents. Rising pension liabilities, triggered by years of shortchanging the retirement plan, have ravaged the finances of Chicago’s school system, the nation’s third-largest, with about 400,000 students. It’s been borrowing at punishing interest rates and raiding reserves to stay afloat.

Minnesota’s debt to its workers’ retirement system has soared by $33.4 billion, or $6,000 for every resident, courtesy of accounting rules, Bloomberg News reported yesterday. The jump caused the finances of Minnesota’s pensions to erode more than any other state’s last year as accounting standards seek to prevent governments from using overly optimistic assumptions to minimize what they owe public employees decades from now. Because of changes in actuarial math, Minnesota in 2016 reported having just 53 percent of what it needed to cover promised benefits, down from 80 percent a year earlier, transforming it from one of the best funded state systems to the seventh worst, according to data compiled by Bloomberg. The latest reckoning won’t force Minnesota to pump more taxpayer money into its pensions, nor does it put retirees’ pension checks in any jeopardy. But it underscores the long-term financial pressure facing governments such as Minnesota, New Jersey and Illinois that have been left with massive shortfalls after years of failing to make adequate contributions to their retirement systems. The Governmental Accounting Standards Board’s rules, ushered in after the last recession, were intended to address concern that state and city pensions were understating the scale of their obligations by counting on steady investment gains even after they run out of cash — and no longer have money to invest. 

Oregon Gov. Kate Brown's (D) special task force is looking at ways to ensure the state has enough money to pay pensions for eligible state employees amid a multi-billion-dollar pension fund deficit, the Associated Press reported yesterday. The state is considering commercializing its state-run liquor system, pulling money from public reserves or imposing new surcharges of up to 10 percent on all state-issued permits, licenses and registrations. The advisory task force, made up of seven private- and public-sector executives, is charged with drafting a plan to take $5 billion off the Oregon Public Employees Retirement System's $24.5 billion unfunded liability without touching government workers' retirement benefits.

Independent consultants have said Kentucky needs an extra $700 million a year to save its public pension systems, and now lawmakers will hear some ideas on where that money could come from, the Associated Press reported. Kentucky's public pension systems are among the worst funded in the country. Officials estimate the state is $33 billion short of the money it will need to pay retirement benefits over the next 30 years. In May, the PFM Group told lawmakers they needed an extra $700 million a year to save the system. That's in addition to the $2 billion taxpayers are scheduled to spend on pensions this year.

A laid-off employee from battery maker Alevo filed a lawsuit Tuesday in federal bankruptcy court alleging the company violated a law requiring it to give workers 60 days’ notice of a downsizing, the Charlotte (N.C.) Observer reported today. The U.S. arms of Alevo, the Swiss battery maker with a high-profile Russian investor, on Friday filed for chapter 11 protection and announced layoffs for 290 workers in Concord, northeast of Charlotte. The plaintiff, Jerome Singleton, worked as a project manager until Friday at Alevo’s facility located at a former Philip Morris cigarette factory in Concord, the suit says. According to the complaint, he received no advanced notice of the layoff or any explanation. The lawsuit, which seeks class-action status, alleges the company did not provide required notice under the Worker Adjustment and Retraining Notification Act and asks the federal bankruptcy court for “statutory remedies, as well as unpaid wages.”