The incident happened at Munchkins Nursery in Shard End, on September 23, 2013, the Birmingham Mail reports .
Passing sentence, Judge Roderick Henderson said: “It requires no imagination at all to realise how serious this could have been had the child fallen head first on to concrete slabs directly underneath the window.
“There was some delay before staff realised what had happened.
“That demonstrates a lack of supervision by them at the time.”
The judge said the boy suffered night terrors after his ordeal while his parents had experienced “enormous distress”.
Billy’s mum Kerrie Coniff, from Castle Bromwich, demanded the nursery be shut down after her son’s accident.
She said doctors told her that Billy must have had a “guardian angel” on his shoulder.
“I entrusted them with the most precious thing in the world,” she told the Mail in October 2013. “I could have been planning his funeral now.”
Birmingham Crown Court heard the boy climbed into a toy cot in front of a window and onto a radiator cover to get on the sill before he fell from the open window.
Two members of staff were present but were supervising children at the other end of the room.
The window was not secured to prevent the boy from falling but he escaped with minor injuries.
Joseph Millington, prosecuting, said: “The room has four openable windows. None were fitted with restraints or restrictors.
“The boy was known to the nursery staff, including those supervising at the time, to be a climber.”
Andrew McGee, defending, said: “The defendant recognises this was a serious incident and profoundly regrets that this accident happened.
”He said Holmes, 62, of Buryfield Road, Solihull, was so upset by it that she closed the nursery down.
Mr McGee said she had been aware of the risk and attempts had been made to fit restrictors but these had failed and the matter had then lapsed.
He went on: “On the day the room was not supervised as she would have expected.
“It is clear both nursery nurses were at the other end of the room at the time.”
Holmes was fined £2,500 and ordered to pay £14,000 costs.
Birmingham City Council said Munchkins ceased operation following action taken by Ofsted.
The authority said a new nursery business, which had no connection to Holmes or Munchkins, had been operating on the site since September 2014.
The sentence was welcomed by Coun Barbara Dring, chairman of the council’s Licensing and Public Protection Committee.
She said: “When parents take their children to a nursery, they reasonably expect their son or daughter will be safe in the nursery’s care and that no harm will come to them.
“This little boy was incredibly lucky not to have suffered more serious injuries after falling from a first floor window.
“Any business responsible for looking after children has a legal obligation to ensure any potential risks to their health and safety are identified, assessed, and have adequate controls in place to protect children in their care.
“This awful accident could have been prevented had some inexpensive window restrictors been fitted, or the windows closed in the room.
“Our officers will continue to take action where health and safety standards are not met to help ensure incidents like this do not happen in future.”
