Rowena and Jack Churchland from Clapham, south west London, decided to install the CCTV after a handful of incidents made them feel uneasy about their nanny, referred to as Agatha.
They said she sometimes lied about her whereabouts and on one occasion a neighbour claimed to have seen her leave their 18-month-old son, Olly, unattended outside for long periods of time.
They dismissed these incidents as errors of judgment, but agreed to take action after Olly's maternal grandmother, who had recently stayed with the family, raised concerns.
Rowena told the Daily Mail: "She told me she felt she had two faces - one when people were watching, and another when she thought she was alone.
"She said when I wasn't there Agatha was much less interactive with Olly. Ultimately, she said she didn't trust her."
The couple then decided to install the hidden camera, which captured the dramatic footage of Agatha flinging Olly to the bed and repeatedly smacking him until his body shook.
After showing the video to police, Agatha was charged with cruelty under the Children And Young Persons Act, but not assault.
Despite accepting she had assaulted Olly, she was found to be not guilty of the cruelty charge and walked free.
The Churchlands have now filed a formal complaint.
You can see the video below.