RUTH Davidson is facing calls to sack shadow tourism minister Rachael Hamilton after the Tory MSP was fined over £50,000 for breaking the law on workplace pensions at the upmarket hotel she owns.

The wealthy hotelier had originally faced a £400 penalty, but this surged to £52,500 when the charge was not paid.

Officials imposed the fine while Hamilton was fighting a by-election in a safe Tory seat that saw her elected to Holyrood.

Last night, Hamilton blamed the breach on a "typo" error.

The offence was committed at the four star Buccleuch Arms in Melrose – in the constituency, Hamilton, where she is now the MSP.

Hamilton and her husband, Billy, own the hotel which, on its website, talks of its "award-winning reputation as one of the finest Inns in Scotland".

Davidson appointed Hamilton to her shadow cabinet to speak on tourism issues soon after her by-election victory last June.

However, MSPs and unions say Davidson should sack Hamilton from her frontbench team.

The fine imposed by the Pensions Regulator – a public body backed by the UK Government's Department for Work and Pensions – is hugely embarrassing for the Tories.

Under the Pensions Act 2008 every employer in the UK must put staff into a pension scheme and contribute towards it. Hamilton's firm, which trades as Borders Hotels Ltd, was punished for being “non-compliant” with the law.

The Pensions Regulator made at least a dozen requests to the company asking it to explain its workplace pensions arrangements, as the fine escalated.

The couple finally responded to the requests and are compliant with the law.

Pensions Regulator officials initially fined the hotel £400 in February 2017 for breaking the law.

The couple were then handed an Escalating Penalty Notice (EPN) last April, which saw the fine increase by £2,500 per day for failing to comply.

The fine was eventually capped at £52,500 in May – just weeks before Hamilton became an MSP.

Hamilton said she and her husband only became aware of the fine in October.

She said "notification was sent to the wrong email address" initially.

Officials obtained a court order to recover the cash. The case is currently a civil matter.

However, Hamilton is appealing the fine, which has yet to be paid

Last night, Labour and SNP MSPs said Davidson should sack Hamilton from her shadow cabinet.

Labour MSP Neil Findlay said: "The auto enrolment process was introduced to ensure that workers had access to a pension and here we have one of one Ruth Davidson’s closest allies being fined £52,500 by the regulator for avoiding her responsibilities.

"This is disgraceful, Rachael Hamilton should be sacked from her front bench role."

SNP MSP Christina McKelvie added: "Of course Ruth Davidson must sack Rachel Hamilton.

"Even if she pays her £52,500 now, in light of negative publicity, the facts stand for themselves: her own behaviour, which is in breach of the law shows the contempt in which she holds the law and her hardworking staff.

"Workers in Scotland deserve better treatment than this.”

Hamilton's parliamentary register of interests states that she owns a 49 per cent share in the hotel. Her husband owns the bulk of the rest of the business.

The hotel employs 33 workers, according to the firm's statement to Companies House.

Hamilton is also listed as the secretary and director of the business.

Hamilton was initially elected as a south of Scotland list MSP in May 2016.

She was also a Scottish Tory business spokeswoman at Holyrood.

However, she resigned her seat to fight the by-election last June in the safe Tory constituency of Ettrick, Roxburgh and Berwickshire. She was elected with a majority of more than 9,000.

Hamilton – a Tory right winger – has previously attacked the minimum wage. In tweets in May 2016 she challenged the basic premise of the minimum wage, which was brought in by Tony Blair’s Labour government in 1999.

She tweeted: “Why do politicians think they have a right to decide the minimum wage? It's businesses who pay wages."

She also complained about rates rises for hotels, during her time at Holyrood.

Bryan Simpson, an organiser in the hospitality sector for Unite the union, also called on Davidson to sack Hamilton as a shadow minister.

He said the £52,500 fine made Hamilton's position in the shadow cabinet "completely untenable".

He continued: "These latest revelations about a director of the hotel, Tory MSP Rachael Hamilton are a disgrace and highlight the contempt she has for her own workers.

A spokesman from the Pensions Regulator said: "We don't routinely comment on individual cases."

In a statement to the Sunday Herald, Hamilton said the breach was caused by a typo error, made when her business had sought to comply with the law.

The MSP said she and her husband were not informed they had broken any rules until October.

Hamilton said she was not aware of the offence during her by-election campaign.

She said: “All employees of Borders Hotels are fully enrolled in pension schemes and no contributions have been missed.

“The company employed to ensure the documents of compliance for auto-enrolment were correctly submitted made a typo on the reference number of one document.

"The deadline was therefore missed but notification was sent to the wrong email address, so we were not informed.

“This is now going through the appeal process.

“As a locally based family run business, we will continue to invest in the pensions and training of all our employees.”

The Scottish Tories said Davidson would not sack Hamilton.