Office 365 encryption is not working

We’ve used sensitivity labels to encrypt emails for months, no issues. No configuration changes have happened. 

We have had a drastic increase in complaints that our vendors cannot open attachments. I tested and see that, even with an external Microsoft license/tenant, I can open the email but it forces a login screen to open attachments. When I use the external account login, it attempts to login to our tenant ( the sending tenant). It rejects the login because there is no account there. Why is it asking for a login?  This is causing chaos for our business. 

Any help is appreciated. 

Thanks