Erase Mac Mini asking for recovery key (FileVault is off)

Hello,

I migrated to a new M4 Mac Mini and am trying to erase the old M2 Mac Mini. When I tell it to erase I keep getting asked for login password to my work MacBook Pro which is managed by IT Dept. I put in my user password (which is a admin) and tells me wrong password. It then goes into asking for a recovery key which I don't have.

Why is my Mac Mini that doesn't have filevault on, asking for my work computers login password?

Yes, work computer is logged into my icloud.

Steps:

1) System Settings -> General -> Transfer or Reset -> Erase all content and settings.

2) Asks for admin credentials - success

3) Sign out Apple ID password - success

4) Enter Mac-mini Password pop-up - I enter correct password

5) Enter the password you use to unlock (Name of work computer) - incorrect

This is where I am stuck. Why is it asking for my work computer at all?

Since my work computer does have filevault turned on by IT Dept, is that messing up my iCloud?