Yes, it can, although it might depend on the 'type' of label (small label/one per page, Avery style/many per page, etc.). I'm not sure what "will always eject" means.
Here's some advice if you plan on deploying the report to another machine:
1) Design the report using the same printer/driver that will be used in production.
2) If you need to set up a custom paper size for the size of the label, make sure you set up the same Custom form (name and size) on all machines the report will print from.
3) If the report might be printed on more than one make/model of printer, test with both before deploying.
I've had some ugly battles with these things...
-dave