In custom geoprocessing tools (either .pyt or .atbx), when a feature layer input has a selection, clicking the refresh arrows next to "The input has a selection. Records to be processed: X" currently does not call updateParameters(). Clicking those arrows updates the blue text to reflect the number of selected features, but will not initiate any Validation scripts. I believe it should.

In my workflow, we use a tool in a python toolbox. Users make selections in a point feature layer, which populates a drop down of IDs. More happens after this (additional dropdowns of related records, etc.) that isn't relevant to the proposed Idea. Currently, the user can not change their map selections and re-run the tool without closing and re-opening the tool. It seems intuitive that refreshing the selection would also refresh any validations. See this post for my workaround.