Virginia’s minimum wage is expected to rise to $12 in 2023 after lawmakers in the General Assembly approved a compromise wage hike on Sunday.

Democrats in the state’s House of Delegates had sought an increase to $15 by 2023, but faced resistance in the more conservative Senate. The legislation that passed both chambers over the weekend creates a path to a $15 statewide minimum wage, but only if lawmakers authorize another increase in 2024.

Virginia currently follows the federal minimum of $7.25.

Labor advocates with the Raise the Wage Coalition welcomed the compromise, calling it an “important first step.” But they criticized exceptions in the bill that exempt certain workers from minimum wage requirements.

“While this legislation will tangibly improve the lives of hundreds of thousands of workers across the state, we strongly oppose the discriminatory exclusions against agricultural workers, students, and others,” Raise the Wage coalition coordinator Lenace Edwards said in a statement.

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The bill does, however, remove controversial exemptions for domestic workers and people with intellectual disabilities.

Republicans and moderate Democrats in the Senate had pumped the brakes on a statewide increase to $15, saying it would put rural employers out of business. Senators proposed creating a minimum wage that varied by region depending on local economic conditions.

“You have no idea how devastating [a statewide $15 minimum wage] will be,” said Sen. Stephen Newman (R-Lynchburg) during a committee hearing last month. “This will be murderous to the jobs of central and southwest Virginia.”

Newman was among the senators who supported a regional minimum wage that mostly affected more affluent Northern Virginia. But that idea was rejected by members of the Virginia Legislative Black Caucus, who said it would keep black Virginians locked into lower wages.

“Under the regional approach … most Black Virginians would be left behind,” Virginia Legislative Black Caucus members said in a statement. “Only 23 percent of Black Virginians live in the areas that would likely see the largest minimum wage increase.”

The bill calls for the state to study the feasibility of a regional minimum wage, beginning in January 2022. The outcome of that study will presumably inform a second vote in 2024 that determines whether the wage will rise to $15 statewide.

In a speech on the House floor over the weekend, bill sponsor Del. Jeion Ward (D-Hampton) hailed the compromise’s passage.

“This is a great day for working people in Virginia,” Ward said to applause. “This bill will benefit nearly 800,000 people in Virginia, both in urban areas and rural areas. It will help to close the gender pay gap. It will help to close the racial pay gap. It will make entire families and communities stronger in every corner of this commonwealth.”

If Democratic Gov. Ralph Northam signs the legislation, Virginia’s minimum wage will rise to $9.50 in January 2021 and $11 the following year, reaching $12 in 2023.