The fix released here fixed my issue, upstart version: 1.5-0ubuntu7.1
$ dpkg -s upstart
Package: upstart
Status: install ok installed
Multi-Arch: foreign
Priority: required
Section: admin
Installed-Size: 1172
Maintainer: James Hunt <james.h...@ubuntu.com>
Architecture: i386
Version: 1.5-0ubuntu7.1
tag changed to 'verification-done'

** Tags removed: verification-needed
** Tags added: verification-done

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https://bugs.launchpad.net/bugs/980917

Title:
  Failed to create pty - disabling logging for job [SRU]

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