In big environments you want every user as /home/user in the passwd.
If your physical storage path is different you need a mapping.
Having bind mounts in fstab is one solution.
The Sun Microsystems solution was automounter, using an auto.home (later auto_home) map.
# cat /etc/auto.master
# cat /etc/auto.home
This is NFS syntax. It makes most sense if you have shared home directories on many computers.
The auto.home map (and even the auto.master) can be in NIS (or NIS+ or LDAP), as a means to centralize the administration of auto.home. Otherwise another configuration management must provide the identical /etc/auto.home files.
If only used locally, the NFS is some overhead: the server1 is the local host. In Solaris the automounter detects that and automatically uses an efficient bind mount (in Solaris implemented as another mount type: lofs).
I tell you this because it is THE traditional enterprise standard. Linux has re-engineered (and other commercial Unix have licenced) NFS, autofs/automounter, NIS. And all have implemented openldap.