When a user is included in more than one sensitivity label policy, the policy with the highest priority (the lowest numeric value) determines settings such as the default label. Because Policy A currently has priority 0, its default label (General) overrides Policy B. Raising Policy B to a higher priority than Policy A places it first in the evaluation order, so Engineering users receive the Confidential Engineering default.
Removing the default from Policy A would change the experience for every user, which the requirement forbids. Changing auto-label settings does not affect default labeling, and restructuring sublabels inside Policy A still leaves Policy A at the higher priority, so it continues to override Policy B.
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