You don't mention why mom is living with you, but if circumstances permit, maybe it's time to separate if she won't respect your authority as the boy's mother.
Right or wrong, she has no right to undermine you as a parent. She is destroying your bond and relationship with your son. He may play favorites but in the end he's going to pay for her bad judgement.
So time to tell her to hit the bricks if she can't keep her mouth closed, opinions to herself and urges to step in an "fix" things under wraps.
Next, you dono't mention what is going on with him and school. No kid skips school just because he doesn't like it. There is something wrong and either he isn't telling you or you're not hearing him out and responding to his concerns. I suspect bullying or academic failure are behind his absences, or perhaps a case of an out of control permissive grandma letting him get out of work to pursue" just being a kid." Whatever the reason, you need to find out now and directly address the problem.
If it's bullying you need to talk to your son and school officials. If a good solution can not be made between all parties, seriously consider homeschooling. He needs his degree to make it in this world. If he can't stand the environment there, he doesn't get along with the teachers and/or kids, or he isn't getting the academic help he needs if he's struggling, you need to find a suitable alternative for his education. Seriously look into homeschooling, a private school or an alternative or charter school. Tutoring outside of what the school offers may be another suitable option if academic struggles are at play. If you opt for homeschooling, grandma needs to be reined in. This option will not work if she's still in the picture. Believe me. Without her in the mix, it could do wonders for your son.
If it's grandma letting him off the hook of an honest day's hard work, tell her to butt out or move out...as I've already said...if you don't get tough on her and get her out, she will destroy your son's life. Tough love is what he needs...even if means exacting some of that tough love on mom in the process. If for some reason it is YOU who is financially dependant on mom and she's somehow supporting you financially, it is time to end the toxic relationship. You need to find a way to support yourself on your own so you don't have to put up with a meddling mother who is weilding her power over you and your family because you have no financial control of your own. Once again, you need to set a good example for your son. If he sees you caving to your mother's bad example he will only learn to self sabotage his own life. You need to distance to move ahead.
PS: Where's dad. He needs to set the bar on what is acceptable behavior for a man at home. If hubby isn't teaching him to respect women, particularly his own mother, then hubby needs some schooling and improvement as well. Hubby needs to get more involved. Your son will respond to a male disciplinarian. ..even before listening to grandma. Hubby is key to successfully reigning the kid in.