In 7.9.0, if you use the User Management component to edit an existing user without changing the user’s current password, the updated information is not saved. After editing a user and clicking save, the component reports - Password too short.
It seems like the component is checking the password against the Password Policy even if the password hasn’t been changed. I’m assuming that if you don’t edit the password then the User Management component has a null value for the current password, and when you click Save the user the component is checking a null password value against the Password Policy which is causing the Password too short error.