Governor Jerry Brown after signing the new minimum wage law

The western U.S. state of California will raise the state’s minimum wage to 15 U.S. dollars per hour by 2022, the first American state to do so.

The  legislation was signed in Los Angeles  by Governor Jerry Brown on Monday   amid opposition from Republicans and business leaders.

“It’s about people … It’s about creating a little tiny balance in a system that every day becomes more unbalanced,” Brown said during a ceremony at the Ronald Reagan State Building.

The state Assembly and Senate both approved the legislation Thursday.

Under the legislation, California’s 10 dollar-an-hour minimum wage will increase to 10.50 dollars in January 2017, then to 11 dollars in January 2018. The minimum wage will then go up by a dollar in each of the following years until it reaches 15 dollars in 2022, after which it will continue to rise each year by up to 3.5 percent to account for inflation.

Businesses with 25 or fewer employees get an extra year to raise their minimum wage to 15 by 2023.

The plan also gives the governor the rights to temporarily halt the raises if there is a forecasted budget deficit of more than 1 percent of annual revenue, or due to poor economic conditions such as declines in jobs and retail sales.

Government workers who provide in-home health services will receive an additional three paid sick days under the plan.

“Today we’re not just witnessing the signing of a bill, we’re witnessing the honoring of our social contract — specifically that, if you get a job and work hard, you will be able to support family,” said Assembly Speaker Anthony Rendon.

The wage hike will affect 5.6 million workers, or about one-third of the statewide workforce, officials said.

The legislation earned praise from U.S. President Barack Obama, who hailed the state for bolstering wages and ensuring paid sick leave for workers.

“With these actions, California is expanding its promise to workers that they shouldn’t have to lose a paycheck if they get sick and has ensured that workers will no longer be earning a wage that keeps too many families in poverty,” Obama said.

“Since I first called on Congress to raise the federal minimum wage in 2013, 18 states and the District of Columbia have acted on their own to raise the minimum wage. States and cities are making progress in expanding paid leave. Now it’s time for Congress to step up and do what is right for every hard-working American and for our economy,” he said.

Meanwhile, Republicans and business leaders opposed the statewide minimum-wage hike, arguing it will lead to businesses reducing the size of their work force or increasing prices to cover the costs of the increased wages.

But supporters, primarily Democrats, rallied behind the proposal, saying workers earning minimum wage should be able to pay for basic necessities.