[Jessie David] “I received a call from one of their employees who left a message stating that he was their new video guy “
From this, I infer that the business is not primarily a video production company, but uses video fairly extensively. The owner must figure that even at your reduced rate, he can get a better value by bringing the video work in house.
This guy has played you for a fool. So why not turn that around on him? I recommend that you play the wide-eyed innocent, who assumes that everyone else is as honorable as you are. If the owner won’t meet, write that e-mail, copying your mutual friend. Remind him of the understanding, assure him of your continued interest in working for him, especially since you feel a part of his success, and share with him your confusion about being contacted by his employee who identified himself as a video guy. You’re happy for his success, you’re enclosing your (full) rate card, and you look forward to working with him in the future.
If he has a guilty conscience, you’ll get some money this way. If he doesn’t have a guilty conscience, it’s hopeless anyway and reaming him out would just feel like a backrub to him.
Don’t give up the elements. If you do, you’re acquiescing in this act of betrayal. If asked, explain that you’re keeping them because you assume that he will honor his commitment, and therefore, you will need them to service his account. If he assures you that he will never hire you again, do that math about the difference in the rates, and offer them for that difference.
While some businessmen value their workers and treat them very well, there are those who tend to ask just a few questions: Does this person help me make money? Can I get his/her services cheaper/better from someone else? The recession isn’t bringing out the milk of human kindness in those people on the borderline, either.
Good luck to you. I’m sorry this happened.
Bob C