I have three systems where customers are using email gateway to Outlook 365. All three stopped working a couple of weeks ago.
Error message in activity log shows "Failed to start SSL/TLS encryption" No changes were made in phone systems settings but
IT vendor is pointing finger at us. Anyone seen this? Thanks.

Encryption is a now a requirement on these sites o365by the looks of it.
If you have asvmi20i or os7200s and below you can do ssl/tls encryption from memory.
Or ask the it vendor to turn off encryption requirement on the mailbox you are authing with to send email