To apply sensitivity labels in Microsoft 365 (Teams, SharePoint, Files….), users must be signed in with their Microsoft 365 work or school account.
Let's see how to apply sensitivity labels to SharePoint Document libraries and current limitations.
More about Sensitivity Labels
In this video tutorial, you’ll learn how to protect and classify data in Microsoft 365. Sensitivity labels allow you to secure data encrypting documents, emails, Microsoft 365 Groups, and SharePoint Sites, especially in those cases where you deal with confidential documents. In this tutorial, I walk you through every step to enable, create and configure properly sensitivity labels.
https://www.youtube.com/watch?v=PFvmz5tUnYo&t=0s
In addition to using sensitivity labels to protect documents and emails, you can also use sensitivity labels to protect content in the following containers: Microsoft Teams sites, Microsoft 365 groups (formerly Office 365 groups), and SharePoint sites. For this container-level protection, use the following label settings: