You did not do anything wrong with the set up. Sometimes, when a new user is set-up in Employee Master, their profile does not sync to Single Sign On, so the systems still reads as them not having KARMA access.

I am always happy to troubleshoot these issues, but in case you are curious, here is what I did:
I searched for the user in Employee Master > Clicked the KARMA checkbox at the top of the screen > click submit > if there is a "Y" in the LARMA column they are synced to SSO. In this case, I would put in a ticket.
If the KARMA column is blank, I recommend editing the user > removing the KARMA license > save > edit user > add license back > save > click submit button with KARMA box checked to confirm the "Y" now appear.