Microsoft Purview Client side labeling issue

Hello Everyone,

I hope this message finds you well. I wanted to share some observations and seek your guidance on an issue I'm encountering with sensitivity label recommendations in Outlook.

I have created a label with auto-labeling (Client side) enabled and configured it to identify sensitive information types (SITs) such as SSN and credit card details (Instance count 1- ANY). The curious part is, when I attach a Notepad file in Outlook that contains SSN and credit card information, I do not receive any sensitivity label recommendations in both Outlook desktop and web versions. However, if I paste the same content directly into the email body, I do receive the respective sensitivity label recommendation.

Moreover, when I attach a Word document (not labeled) that contains SSN and credit card information, Outlook does not show any recommendation either. Interestingly, if the Word document detects the sensitive content and recommends a label, and I then save the document with the recommended label, attaching it back to Outlook does trigger the label recommendation.

Could you please clarify if this behavior is by design or if there might be a missing configuration on my end? Your insights would be greatly appreciated. Thank you!