(1) While misconduct usually occurs during the claimant's normal working hours, "off-duty" conduct may constitute misconduct if it meets the criteria in 39-51-201, MCA, and if such conduct:

(a) significantly and adversely affects the claimant's ability and capacity to perform job duties; and

(b) significantly and adversely affects the employer's business to a substantial degree.

(2) The connection between the misconduct and its effect on the employer's business must be reasonable and discernible. Speculation as to adverse effect upon the employer's business is not sufficient.

(3) The employer must demonstrate by a preponderance of the evidence that the off-duty conduct significantly affected the employment relationship.