The Swan Mill Paper Company was aware that engineers would use interlock keys to override the guarding on machines for the purpose of diagnosing faults.
One engineer injured his fingers when his hand became trapped after he defeated an interlocked door to get a better look at a wrapping fault.
The incident, on 15 January 2013, was investigated by the Health and Safety Executive (HSE), which prosecuted the company for safety failings.
Sevenoaks Magistrates' Court was told HSE found at least three members of the company's maintenance team had interlock keys for bypassing and defeating interlocks on the machines, thus potentially exposing themselves to dangerous moving parts.
HSE said defeating of interlocks was common in industry and companies were often under the misleading impression that, if carried out by engineer, such a practice was safe. After the engineer's incident and HSE's investigation, Swan Mill removed all such keys from the workforce.
Swan Mill Paper Company, of Goldsel Road, Swanley, Kent, was found guilty of one breach of the Provision and Use of Work Equipment Regulations 1998 (PUWER). It was acquitted of another charge under Regulation 22 of PUWER Regulations.
HSE Inspector Rob Hassell said: "Companies should ensure that equipment is suitably guarded at all times. If access is needed to machinery, for whatever reason, then measures should be taken to adapt the machine to ensure its safety either by further physical safeguards, such as additional guarding or operating at reduced speed; ensuring that employees stand back is not acceptable.
"Latest HSE statistics show that about 15% of reported major injuries involved contact with moving machinery and the risks are well-recognised within the industry. HSE has plenty of free information and guidance to help firms identify problems, find sensible solutions and get things right."