I have a shared /home setup using Perceus Cluster Software (http://perceus.org) for our Cluster. Nodes are using CentOS 6.1 x86_64. /home is shared from the head to the nodes b
In my case, I haven not created the user using useradd, instead i have added the user in /etc/passwd file and created the home directory for the user with all required files.
After using useradd to create the user and adding the pub key to the authorized_keys file after creating .ssh directory in the home directory of the user, the issue got resolved.
By the way I am using centos 7
Hope this helps some one.