Kittens and Toddlers?

I have a three year old son (just turned). We had as cat that ped away 7 months ago (old age) so he has always had a pet in the house. After we all talked about it we got 2 kittens about two months ago. (he was so excited) Lately, we've been having trouble with the way he handles them. He says he loves them and likes having them but he continually tries to pick them up by their necks, and he will also attempt to hold them down by the neck. I've explained and explained that he could hurt them, (sometimes they mew but they never lash out at him and don't run from him when they see him coming) I've given him time outs, given his favorite toys time outs, taken the kittens and put them in another room, shown him how to properly handle them and finally yelled at him. I've explained it gently, "Oh honey not like that you could hurt them." I've explained it harshly, "Stop that right now, you are hurting them." I'm at a loss, I don't want to give the cats away and I will not my son.