Hmm... I'll try this on mine. I did this on the stock rom with Knox disabled, and SELinux installed fine, set to permissive, said it worked...I was just tinkering with trying to get Airwatch to work with root, and needed it in permissive mode to install Rootcloak. I got rootcloak installed and it seemed to be fine with the permissive setting in SELinux, but I never got Airwatch to work, so I just gave up.
Currently I am on SlimHyde, I'll try SELinux on it and see what it says.
EDIT: Well, it doesn't work now, so either I imagined it working, or...I dont know...sorry.