The use of these file conversion tools is very common and is often used on sensitive information. Heck I’ve seen health companies use these tools to upload god knows what.
Usually there is little to no data sovereignty rules that apply, in that by using the service for free that can own the file you upload and use it to glean information from.
Firstly, employees need to be aware that they are not allowed to use this software and you need to therefore provide a solution. You should then use broker tools to actually block these conversion sites, in the same way that you might block the use of Dropbox and other cloud solutions if these are unsanctioned.
Yes you’re absolutely right to question these services and organisations are having to deal with risk associated with using them. Which is only really an issue if it’s sensitive personally identifiable information.