Health and Safety Executive investigating inspector Lisa Chappell described the incident as “the worst case of what can go wrong when operators cut corners”.
Colin Clifford, 50, from Enfield, was operating the excavator outside a house in Westminster – and within a fenced off area – when the incident occurred.
The excavator had a number of buckets stored in the front bucket of the machine and while, turning the vehicle, Mr Clifford raised the front buckets over the site fence until they were hanging over an unprotected section of public pavement.
After he unintentionally operated the wrong lever the stored buckets fell to the pavement, one of which struck 81 year-old pedestrian Joseph Johnston.
Mr Johnston died soon afterwards.
Ms Chappell said Mr Clifford had sufficient space to turn his excavator without the need to lift the front bucket above the public pavement.
The HSE investigation also showed there were other workers nearby who could have helped in closing the walkway.
Mr Clifford pleaded guilty to breaching the Health and Safety at Work etc Act. He was fined £2,500 with costs of £1,500.