An investigation by the Health and Safety Executive (HSE) found that Ernest Henderson had not been trained in how to repair machinery at the site despite being maintenance manager, he had never been adequately assessed and was left unsupervised when completing maintenance work.
He had not been given a safe system of work to follow to ensure the task was carried out safely, by not running the machine once the safety guards were removed, said the HSE.
It was also found that the emergency stop buttons on the fish skinning machine were not operational.
Henderson was attempting to repair the fish skinning machine that was making a loud screeching noise when in use, when the incident occurred on 17 December 2010 in North West London.
He removed the safety guards around the machine and then switched it on, but a rag he was holding for cleaning got caught and his right hand was dragged into the moving parts.
His hand was severely crushed and his index finger was so badly damaged it had to be amputated at hospital.
Ian Goldstein pleaded guilty, was given a two-year conditional discharge and ordered to pay £1,609 costs.
HSE inspector James Caren said: "Had Mr Goldstein recognised the dangers of carrying out maintenance work on factory machinery and provided a safe system of work it would have never happened.
"But he failed to assess the risks or provide Mr Henderson with the required control measures to keep him safe. He should have also checked Mr Henderson's competence regularly and provided proper training, instruction and supervision,” he said.
"All companies, whatever their size, need to identify key risks and put appropriate measures in place to ensure their employees' safety and it is essential that those asked to do dangerous tasks such as machinery maintenance are competent."