Note that Microsoft state: “After you apply the new retention policy to mailboxes… it can take up to 7 days in Exchange Online for the new retention settings to be applied to the mailboxes. This is because a process called the Managed Folder Assistant processes mailboxes at least once every 7 days. Instead of waiting for the Managed Folder Assistant to run, you can force this to happen by running the Start-ManagedFolderAssistant cmdlet in Exchange Online PowerShell.”
To kick it off, open PowerShell, then run the following commands:
Connect-ExchangeOnline
Start-ManagedFolderAssistant -Identity user@example.com
As an aside, you can check which policy has been applied to users with this command:
Get-Mailbox -Identity user@example.com | Format-List Identity,RetentionPolicy
[NOTE: You can omit the -Identity user@example.com parameter from the above command to list the policy applied to all users]
