Not to beat an issue to death here, but "the level that would result in a disqualification under UI regs" is not cut and dried. In this case as in all others, they'll look at a lot of factors such as warnings, company policies, etc. Usually if someone does something, even if it's misconduct, even if it's not a really bad thing, if the employer does not terminate for it immediately, it's not going to be disqualifying. If they want to take his job away but retain him as an employee (part time, no benefits, much less pay) that's still not getting rid of him by termination due to misconduct.
Though they put the employee on suspension for this situation, it appears they are saying, "Okay, you're fired from being a supervisor because of yada yada, but we don't mind you working for us, so we're going to offer you this part time lower status job!" That sort of defeats the whole idea of his being terminated from his former position for a valid misconduct reason. As I said, I will strongly suspect that unemployment will see this for what it is, a very flimsy excuse to get the employee to quit by adding an insulting job offer to the simple basic termination.
Not us, but the unemployment system will research the situation very thoroughly. I'd say he's probably on a good course to be approved.