WorkSafe chief investigations inspector Steve Kelly said numerous health and safety failings led to this incident.
The severity of the injuries the worker sustained would impact the worker for the rest of their life, he said.
"This incident could have been avoided simply by placing a padlock over the mincer lid to secure it, or by ensuring workers were provided with adequate training and supervision," Kelly said.
"The risks associated with unguarded moving parts of machinery in the meat processing industry are obvious and well-known. However, machine guarding failures in the industry continue to cause significant injuries to workers and it's unacceptable."
In a statement, Alliance Group chief executive David Surveyor said the company pleaded guilty to its failings and had voluntarily provided reparation and support to the worker.
"Our failure to identify a hazard that resulted in serious injury is extremely disappointing. Since the incident, we have installed a series of safety improvements across our plant network and continued a comprehensive review of our internal processes, procedures and systems," Surveyor said.
"The safety of our people is paramount and we accept that we did not do enough to look after the safety of one of our people at our Mataura plant."
Surveyor said Alliance had invested $21 million in health and safety improvements to its plants in the past four years.
This is not the first time Alliance Group has been fined following a similar health and safety incident.
Last year another Alliance worker had their hand amputated on machinery used for dehydrating blood into powder.
The worker had been working at the company for five days and was left unsupervised when the incident occurred in March 2017.
A fine of $332,000 was imposed at the Timaru District Court.