MINNEAPOLIS (WCCO) — Gov. Mark Dayton plans to sign the minimum wage bill into law on Monday, bringing one of the country’s lowest rates to one of the highest in the nation.

The bill, which was passed by the legislature last week, will increase Minnesota’s minimum wage to $9.50 per hour by the year 2016, and index it to inflation.

READ MORE: Suspect In Waukesha Parade Says He Feels 'Demonized'

Cathy Muldoon is managing partner at MJ Scott Search, a recruiting company in the Twin Cities. She was a guest on WCCO Radio’s News and Views.

She says some small business owners fear that it could affect their ability to offer merit pay increases to employees.

“The employee who is doing fair to sub par is still going to get an increase, so what does that say to the employee who is going the extra mile,” Muldoon said.

READ MORE: 'A Very, Very Rare Opportunity': 13 Minnesota Air National Guard Members Return Early Ahead Of Holidays

She said the increase is meant to help about 350,000 Minnesotans.

“The real people who I think everybody wants to see it positively affect, are the poverty line families who are looking to support their families. This could allow them to go from two or three jobs, down a job, so that’s going to be huge,” she said.

MORE NEWS: 'Potentially A Trend Of Things Getting Worse': Omicron Variant Detected In The U.S.

The bill affects businesses with revenue of more than $500,000 a year.