If he was living there with previous tenant’s permission, then he’s not a squatter and he had/has a legal right to live there. You’ll have to evict him if he doesn’t pay rent and you want him out.
Here’s some more info on the process:
(Sounds like the appropriate first step is the 3-day notice.)
Not only was he living there with the previous tenant's permission, he was living their with your knowledge! This guy is a tenant, not a squatter.
Proceed with eviction.