We just paid our weekly cleaning lady in cash each week, too.
utter tosh - I think you may be the idiot... perhaps try proof reading before you post.
just because you pay them cash in hand and everyone else does it doesn't necessarily mean that it is legal to do so.
I don't think anyone is an idiot, perhaps just misinformed about it (and that includes myself).
Check out the MOM website to see if you can find out more OP. I used to pay ours cash too and I haven't got a problem with doing that, but if you do want to do everything legally then MOM is the place to check. However, you might find that it is actually just easier and less stressful to do it cash in hand and leave it at that, I reckon there would be all kinds of legal jargon and tax issues if you did go through the MOM, and the lady you're considering employing is probably expecting cash in hand too.