Apple watch dock favorites not showing

No matter what I do, the Apple watch is not showing favorites set up in the watch app on iPhone.

It always shows recents.

I have hard reset both the iPhone and Watch. I have unpaired and repaired them. I have turned them off and on again as well. I have removed all favorites in the watch app on iPhone, restarted both devices then tried to add them back one by one.

The side button on the watch always shows recents and not favorites. What is the reason for this?