Would he not have had to make/have the source code to produce whatever product he gave him? What would be his reasoning for not providing the source code?
Providing the source code to the employer needs to be discussed separately before the job begins. The freelancer may indeed provide it if he wants to. If he doesn't then you can't force him to do so. The employer is free to find another coder.
If the contract between the two parties says the employee will provide the source one the work is finished, then he should do that. If there isn't anything about that in the contract, then well... the employer should have asked about it.