Fix dashboard labels dropdown

app/controllers/dashboard/labels_controller.rb

 class Dashboard::LabelsController < Dashboard::ApplicationController
   def index
-    labels = LabelsFinder.new(current_user).execute
-
     respond_to do |format|
       format.json { render json: LabelSerializer.new.represent_appearance(labels) }
     end
   end
+
+  def labels
+    finder_params = { project_ids: projects.select(:id) }
+    labels = LabelsFinder.new(current_user, finder_params).execute
+
+    GlobalLabel.build_collection(labels)
+  end
 end

app/models/global_label.rb

@@ -2,7 +2,7 @@ class GlobalLabel
   attr_accessor :title, :labels
   alias_attribute :name, :title
-  delegate :color, :description, to: :@first_label
+  delegate :color, :text_color, :description, to: :@first_label
   def for_display
     @first_label

app/serializers/label_entity.rb

 class LabelEntity < Grape::Entity
-  expose :id
+  expose :id, if: ->(label, _) { !label.is_a?(GlobalLabel) }
+
   expose :title
   expose :color
   expose :description

changelogs/unreleased/34590-fix-dashboard-labels-dropdown.yml

+---
+title: Fix dashboard labels dropdown
+merge_request: 12708
+author:

spec/controllers/dashboard/labels_controller_spec.rb

+require 'spec_helper'
+
+describe Dashboard::LabelsController do
+  let(:project) { create(:empty_project) }
+  let(:user)    { create(:user) }
+  let!(:label)  { create(:label, project: project) }
+
+  before do
+    sign_in(user)
+    project.add_reporter(user)
+  end
+
+  describe "#index" do
+    let!(:unrelated_label) { create(:label, project: create(:empty_project, :public)) }
+
+    it 'returns global labels for projects the user has a relationship with' do
+      get :index, format: :json
+
+      expect(json_response).to be_kind_of(Array)
+      expect(json_response.size).to eq(1)
+      expect(json_response[0]["id"]).to be_nil
+      expect(json_response[0]["title"]).to eq(label.title)
+    end
+  end
+end