It's a little more complicated...
Since you have turned off the use of Appendix P, this Appendix P item is not relevant. The Sy/St switch set to "ON" indicates that the material Sy/St is greater than 0.8. In this case the allowable stress for the operating stress range must be reduced by 15%. The displayed (default) setting is ON indicating that this ratio exceeds 0.8 and that allowable stress would be reduced. The actual switch (a checkbox) is only presented when Appendix P is active (see below).
All this Appendix P stuff will not appear in the next release of CAESAR II as Appendix P has been dropped from B31.3.