If you choose either when it was created or when it was last modified , labeled content in email messages will be deleted ...

If you choose either when it was created or when it was last modified, labeled content in email messages will be deleted based on when the message was sent or received.
Basing this label on an event means that the retention settings won't go into effect until you create the event from the Event page. For example, if you associate this label with the event type "Employment ended", any content that has this label applied will be retained until you create the event (from the Events page) and specify the event type ("Employment ended"), the ID of person who left the company, and the date it occurred. At this point, that event will detect all the user's items that have this label applied and then set the expiration date for those items based on the retention period you chose. Learn more about event-based labels