Not that I am completely against a swat on the bum; but in my experience, I have seen that it is simply not effective. And if, as a rule and not the exception, that is the only form of behaviour correction that is used; a child learns that if we are not happy with someone, we hit them. And if we hit them for hitting someone else, they simply learn that "I am bigger, I am stronger, so I get to hit you." This sets them up for targeting people smaller than they are. It's just a very upsetting cycle.
If you feel like you can continue to work with the family, then just keep your methods the same. He will, eventually, understand what he can and can't do at your house. If you are really uncomfortable, then discuss it with the parents and let them know that you have a difference of opinion when it comes to discipline. I don't think you have the ability or the right to ask them to change; they are the parents, after all. But if you can't come to an agreement, I know that I wouldn't work with a family that didn't mesh with my personal beliefs.