Thank you for post!
The error message "Your organization doesn't allow you to update your password on this site" usually appears when the user is not allowed to change their password on the site. This can happen if the user is not registered for self-service password reset or if the password writeback feature is not enabled.
Could you please verify that you have enable the SSPR and password writeback feature also check the user is registered with the SSPR setup if everything is setup correctly if the issue persists, please Disable and re-enable the password writeback feature, if it still persists it is possible that there is an issue with the password writeback feature or may be the AD Connect server or Domain controller are unable to connect to Entra ID. please check that your on-prem AD is syncing properly by navigating the Microsoft Entra admi center-> Hybrid Management-> Microsoft Entra Connect-> Connect Sync. if the time is showing more than the sync cycle means your server is not connected. If the Server is connected and the sync process is running correctly Restart the Microsoft Entra Connect Sync service this will resolve connectivity issues or other transient problems with the service.
Reference: Troubleshoot self-service password reset writeback in Microsoft Entra ID
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Thanks,
Akhilesh.
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