I have been testing auto apply label in some scenarios, but what I have discovered is that AutoApply Label is not working when I activate the autosave toogle in Word (for example):
I’ve been testing the same policy under different circumstances (Windows 10 + Office 2101 C2R)
Turned ON AutoSave for synced libraries (Default On):
Tested to create a new Word.docx where AutoSave in ON and then added keyword in doc to trigger AutoApply label.
After hit Safe nothing happens, no label applied (or suggested)

Turned OFF AutoSave for synced libraries (Default On):
Tested to create a new Word.docx where AutoSave in OFF and then added keyword in doc to trigger AutoApply label.
After hit Safe the Auto Apply label suggests me to change label.

I will keep tracking that problem…