(Photo by Sky Schaudt - KJZZ)

A new law could delay IRS refunds to more than one million filers in Arizona.

Arizona voters have passed an initiative to raise the minimum wage and require most employers to provide paid sick time.

Proposition 206 was approved Tuesday and will increase the base wage incrementally from $8.05 to $12 an hour. It would rise to $10 next year, then increase every year until 2020.

The measure also allows workers to earn one hour of paid sick time for every 30 hours worked, depending on the size of the business. It also broadens the conditions that allow for sick time to include mental or physical illness or needing to care for a family member.

Tomas Robles is the campaign director for the Arizona Healthy Working Families Initiative, the group behind the now successful ballot measure.

At the noisy Democratic watch party last night, he said that a vote for Proposition 206 is really a vote for all the families and youth in Arizona who live in low-income households or in poverty.

"We see that voters agree with a lot of our families and a lot of our youth … that our families deserve better, they deserve better pay and a healthier workplace, and we got it tonight," said Robles.

David Wells, research director at the nonpartisan think tank Grand Canyon Initiative, said that even families who make upwards of $60,000 can reap benefits from the bill. A report from the Grand Canyon Intiative pointed out that in addition to nearly 800,000 workers who would see higher wages by the measure, around 13,000 might lose their job

The nonpartisan Joint Legislative Budget Committee said it would be hard to determine the effect of a minimum wage increase, although many believe it will result in higher labor costs for businesses.

The federal minimum is $7.25 per hour.

Associated Press contributed to this story.