It does function as a true taunt, however there are two major issues with it.
First, it seems to be based off of spell hit, and as such, it has a pretty high tendancy to be resisted.
Secondly, there is no Glyph for it, like there is for RD, Taunt, etc, so you have no bonus + Hit to it either, the only bonus to Hit you have is from the paladin's actual gear, which isn't terribly high (None of Paladin Tier gear, except the gloves have + Hit).
Likey he is having resist issues (Very common, especially on Horsemen and bosses, I don't even bother with Hand on it, just do RD at 40 yards before the warrior gets in range) which are hard to rectifiy. It's honestly easier to just work around it with RD than use the specialized tool for it...