Cowork tab appearing despite Admin settings

The Cowork tab in the Copilot App has started to appear for some of our Basic and Premium users. I'm not sure why this is happening as we have not setup any usage-based billing and explicitly disabled the following admin setting:

Despite this, the users are able to click on the Cowork tab and enter a prompt. When it is submitted, Copilot tries to login, fails and continues trying to authenticate over and over again. I also cannot find the Copilot Cowork agent (1.3.0) in the Agent Registry to block it.