Ok, upon closer inspection of your original screenshot, it appears you need to hover the padding-area between "Chat" and the border line above -- a separator between labels and the chat modules. You should notice a resize cursor and an ellipsis icon; this separator is movable and reveal more of your labels, without having to hover the labels area to reveal them.
Important tip based on what I see in this thread from multiple people:
If the response is "oh, no problem, just try to find this button, or hover on this very small area to trigger a non-obvious behavior"... we're probably not talking about good UX.
You've never hovered over the chat area? Nonetheless, the bar could could probably use a hint when also hovering the labels area. I'm still unsure how you have written off the designers as simply inept. I could take down any UI with such an attitude.
Wince every OS (MacOS and Ubuntu and Google anyway) adopted on-mouseover scrollbars and click corner to resize?
You might be also interested to learn about this new peripheral that you put on your desk and wiggle, and--get this-- it makes a pointer on your screen move. Crazy, right? It will never catch on! Touch your desk to interact with the screen? What brain-dead idea will they come up with next?