Just to re-cap....the issue is as follows -

> I have a SSIS package which connects to multiple servers

> It executes properly when directly executed from the dtsx file (double click -> execute)

> I have created a credential and a proxy on an instance (enterprise edition)

> I have created a job to execute the SSIS package using the proxy

> The job has a output log file

> I have tried both scheduling and directly executing the job, but it fails before starting with the following error - "Unable to start execution of step 1 (reason: Error authenticating proxy <Domain>\<WindowsID>, system error: Logon failure: unknown user name or bad password.). The step failed."

> Have tried changing the password, but did not resolve the error

> The indivual package is runing fine using multiple user IDs outside the SQL job

> I am using a proxy with credential of the ID having access and who is able to execute the package outside the Agent Job

> Have provided sa priviledge to the agent service account

> Additionally, changing to local system account is out of scope for me.