As of now, I've temporarily fixed this with an app called fluid navigation gestures: https://play.google.com/store/apps/details?id=com.fb.fluid
however, I would much prefer if Microsoft launcher would just add support for gestures
Did you join the "Beta Channel"? if you didn't, as far as I can see, the ML page at Google Play Store still shows the current version is 5.11.5.56362:
https://play.google.com/store/apps/details?id=com.microsoft.launcher
My guess is you have Microsoft Launcher version 5.11 installed. There is a recently released Microsoft Launcher Preview (version 6.2) which does have the "Show single label" option.
Here's a link for the Microsoft Launcher Preview...
https://play.google.com/store/apps/details?id=com.microsoft.launcher.zan
I have not seen this issue on my android 10 with same version. Reinstall the app and see if this fixes or try new preview version https://play.google.com/store/apps/details?id=com.microsoft.launcher.zan
Screenshot: https://imgur.com/a/YKpgS4A