Although I agree most children like this are the ones needing most love, you can't rescue everyone. Mom seemed quite dismissive with her comment that he was up late. If a late night results in such anger, then why would any parent make this situation.

For me, it comes down to the well being of the group. I would not tolerate anyone coming in off the street and treating my children this way in their home/daycare. Just because these parents are handing you a daily fee, that does not mean he gets a lower standard of acceptable behaviour as anyone else entering your home.

I am not yelled at in my house by anyone, adult or child. For it to have already happen more than one time, would be enough.

Give yourself an amount of time for this to settle. End of week, two weeks, whatever you think is fine and if it's not settled by then, get rid of him.