Office 365 Customers using managed (OrgID Based) accounts will not know when passwords will expire (if enabled for expiration). Further, Outlook’s behavior when the password expires is to go into a disconnected state, without notifying the user of what the problem is or what is required to resolve it. Opening Outlook and providing an expired password will continually prompt the user just as if they had mistyped the password.
Once customers deploy an upcoming Outlook update, they will receive a notification 14 days before their password will expire for managed accounts. The notification will include a link to a password change page hosted by OrgID. If they try to logon after the password has already expired (when returning from vacation for example), they will also receive notification that their password has expired and will be provided a link to use to change it.
Forecasted Resolution Date: With the Outlook August 2012 Cumulative Update.
PS: “OrgID” is your organisation identifier.