Tata Steel's UK unit was found guilty of safety failings after the worker suffered serious injuries to his hand at the Trostre plant in Llanelli.
The man, an employee at the plant for 34 years, was working on the production line on December 6, 2012, when his left hand got trapped in a pair of steel pinch rolls. He suffered crush injuries that led to the amputation of half his index finger and part of his middle finger.
The case came up at the Llanelli Magistrates Court last week. An investigation by the Health and Safety Executive (HSE), UK's national regulator for workplace health and safety, found safety equipment in the machinery the worker was using was insufficient.
HSE inspector Steve Lewis said the incident was "completely needless and entirely preventable".
"Tata Steel UK Limited failed to carry out a suitable risk assessment of the equipment their workers were using. They failed to provide machinery guarding to current standards, did not prevent access to dangerous moving parts of machinery and failed to provide a safe system for managing and controlling the risks associated with a production line," he said.
"It is shocking that a company of this standing failed to achieve compliance on such a basic level of machinery guarding, thereby putting their employees at risk. This case should serve as a warning that HSE will not hesitate to prosecute companies where key safety devices are not fitted to potentially dangerous machinery."
Commenting upon the accident, a Tata Steel spokesperson said health and safety is a priority and the company accepts its responsibilities.
"Health and safety is our priority. When an incident of this nature happens, we accept our responsibilities where they lie and, working together with the Health & Safety Execuive and other authorities, we look to learn everything we can and apply those learnings to ensure that our workplaces remain amongst the safest in our sector," the spokesperson said.
London-based Tata Steel-UK had pleaded guilty to three breaches of health and safety legislation.
Tata, considered one of the biggest private employers in Wales and largest steel recyclers in the UK, makes tinned products for a range of companies at the Trostre plant.
The group acquired the plant as part of a deal to take over Anglo-Dutch steelmaker Corus in 2006.