Custom Filter

esc_html is not a filter. You have to search for apply_filters function. Look where $label gets fetched from database and how it is processed, maybe there is some apply_filters there?

Actually, function esc_html has a filter inside https://developer.www.ads-software.com/reference/functions/esc_html/#source-code
and that filter is already enabled by default at front end. I theory, it should get translated.

Please, give me an example of what $label contains before it goes into esc_html.

I assume this got resolved?

Yes, i found thru debugging the wrong locale! Change it and everything works flawlessly!