Dennis Hawksworth, 61, was unblocking a machine used for removing debris from sludge at Toton Sewage Treatment Works when his left hand became caught in the machinery.
The machine’s lid was damaged leaving parts of the machinery exposed. Mr Hawksworth lost four fingers and part of his palm.
Severn Trent Water pleaded guilty to breaching health and safety regulation and was ordered to pay £6,730 in costs.
The Health and Safety Executive is warning employers that they must regularly inspect and maintain their equipment to protect its workforce.
HSE inspector David Butter said: "This was an entirely avoidable accident which resulted in a man losing four fingers. Injuries from poorly-maintained equipment remain a significant and regular problem nationwide and companies must ensure that equipment is regularly inspected and maintained so workers aren't exposed to this kind of risk."