On-Demand Migration: Active Directory Passwords are not syncing.
The Option "Allow password changes from other environments" is not checked on the target agent that needed the password to be synced.
Sample screenshot below.

"Allow password changes from other environments." This option is not enabled on the environment that is required to be synced.
Verify the destination that required the password to be synced, and check the "Allow password changes from other environments" following the navigation below
ODMAD > Environment (select the environment and settings)>Passwords.
Refers to the document What does the Allow password changes option do? on how to enable the sync.