^ ^ ^ exactly what i thought. Aren't we supposed to follow that word order (¿Disculpe señor, usted está ocupado ?) rather than ¿Disculpe señor, está usted ocupado ? except for in rather rare instances where Spanish inverts the word order (based on specific rules) ? Well maybe in this example it doesn't matter since we are simply transcribing what we hear (whether grammatically correct or not.)
Jay, in Spanish yes-or-no questions, you usually go for a SVO order, so "¿usted está ocupado?" would be the standard. But subject pronouns like usted are very flexible and can move to many positions within a sentence. In this case, you can place usted anywhere and it will have slightly different connotations:
¿Usted está ocupado? - catching attention (which is a bit moot here because we already do that with "disculpe señor")
¿Está usted ocupado? - adds politeness; might also clarify that I'm not talking about someone else (¿está él/ella ocupado/a?)
¿Está ocupado usted? - I'm specifically asking you of all people.
You'd need to make a few more changes. First, you wouldn't really address them as señor, but with their first name instead. Other than that, you need to conjugate the verb differently. Usted and the informal tú use different conjugational forms: "tú estás" and "usted está". Finally, since disculpe is a verb (in imperative mood) as well, you need to reconjugate that, too.
So the informal sentence could look like "Disculpa, ¿(tú) estás ocupado?"