I do not know anything about your qualification, experience or the industries you have worked with.
But let me tell you that thee assignment given to you, viz "inflation,cost of living impact analysis for salary hike proposal. Alongwith this I am also required to do education,experience and gravity of work analysis for every employee.Based on both analysis I have to prepare salary mapping and a proposal which says how much hike we should give to our employees."
is something that a seasoned HR professional will have difficulty in doing it single-handedly !!
The assignment is quite complex. I can only give you certain ideas on it.
What industry are you in ?
Are you aware of the industry average salary in case of different position/grades; in a company similar to yours/your nearest competitor ??
Are you acquainted with the concept of Consumer Price Index and CPI for Industrial Workers etc. ?
What has been the approx. hike in D.A. in last 4 quarters ??
Can you somehow extrapolate the effect of Cost of Living, using the above indices, on a sample salary in every pay-range as applicable in your company ??
To analyse education,experience and gravity of work analysis for every employee, Hay's method is most appropriate. However its not practical in your case since its time taking and you do not need precise information.
You can have a point system in which you give appropriate weightage to the 3 components. Then for every component you can fix-up a scale of measurement. For example in case of education; on a scale of 1-25 you can give points for no. of years of study, then additional points for professional courses, like 5 for Diploma/certificates, 10 for degrees etc. Then from 1 to 10 points for the reputation/ranking of the Institutes. Similarily, for experience - points for no. of years, points for range of salaries; points for the reputation/size of companies worked.
"Gravity of work" analysis depends on a lot of factors such as, no. of reportees, level of boss to whom he reports, value and nature of the decision/contributions made by him etc. This will also involve competency mapping.
Based on these you have to arrive at the proposed salary band/structure at each level. Compare this with his existing salary.
Factor in his current performance scores; and arrive at an approximate salary proposal.
The above are only bare outlines. Depending on the time-frame, your capabilities and resources, size of the organization etc. you will have to arrive at an acceptable proposal.
I once again reiterate that its a complex assignment and better left to the experts or outsourced, if precision is required. An HR single-handedly can only produce an approximation and somewhat satisfactory proposal.
22nd December 2013 From India, Delhi