External environmental factor has a huge impact on the human resource policies of an organization especially in the case of the Toyota. Though Toyota always believe in consistent and fair HR practices providing clean and safe work place to employees but the impact of the recession which was a major economical factor was apparently observed even in the HR practices of the company. The company was always committed in providing stable employment to employees and rewarded with rapid promotion to skilful worker but due to recession and various other external factors Toyota reduced the number of new recruitments and was even forced to lay off the employees. The employees were asked to relocate and functional flexibility was demanded from them. Even the rewards were then depended on the profitability. The company is very serious about the environment and has initiated a go green mission where they give incentives to employees for minimizing the wastage and saving the energy. They give a lot of emphasis on training and cross functional culture due to dynamism in technological advancements. They have very strict norms for unethical practices, sexual harassments and whistle blowing policy. Thus we can conclude that external environmental factor has a huge impact on the HR policies of a company and they are highly related as company has regularly addressed these problems by bringing changes in their policies in Thailand’s.