Hi CurtFLC,
Based on the information you’ve provided, the error could occur if the users has already been created in Office 365 before.
Given the situation above, please try the steps below to fix it:
- Deactivate directory synchronization and delete all the user accounts synced to Office 365 (with a sync icon).
- Change the user’s UPN and primary SMTP address in the local AD to user@mycompany.com, then check if they are the same between the user in the local AD and in Office 365.
- Reactivate DirSync, it will then SMTP match the two users via DirSync.
- Change the user’s UPN and primary SMTP address in the local AD to the domain.com, then force a sync between the local AD and Office 365.
For more details, please refer to: How to use SMTP matching to match on-premises user accounts to Office 365 user accounts for directory synchronization.