You are correct, instructions don't address this level. State nexus (the right to tax) is based on where he works. Wherever his normal workplace is located, regardless of where his company is located, is where his income while working and therefore benefit pay too, should be taxed (even if he works in both places).
If he normally works out of the NY office, NY should tax it, but if he was hired to work from home, then you could keep it on your resident MA return. Even though all income is reportable in your resident MA state, you'll get credit for the taxes paid to NY.
