diff --git a/tests/integration/test_label.py b/tests/integration/test_label.py
index 4f585d6d3..703b122a4 100644
--- a/tests/integration/test_label.py
+++ b/tests/integration/test_label.py
@@ -43,7 +43,8 @@ def test_label_export(configured_project_with_label):
 
 # TODO: Skipping this test in staging due to label not updating
 @pytest.mark.skipif(condition=os.environ['LABELBOX_TEST_ENVIRON'] == "onprem" or
-                    os.environ['LABELBOX_TEST_ENVIRON'] == "staging",
+                    os.environ['LABELBOX_TEST_ENVIRON'] == "staging" or
+                    os.environ['LABELBOX_TEST_ENVIRON'] == "custom",
                     reason="does not work for onprem")
 def test_label_update(configured_project_with_label):
     _, _, _, label = configured_project_with_label