According to the United Nations agency International Labour Organization (ILO) persons in employment are those of working age who, during a short reference period, were engaged in any activity to produce goods or provide services for pay or profit. This is comprised of   
a) employed persons "at work", who worked for at least one hour during the reference period (often set to one week); and   
b) employed persons "not at work" due to temporary absence  (such as shift work, flex time, compensatory leave for overtime, parental leave or illness).

Statistical scope:   
The source to employment numbers are monthly wages in cash paid by an employer to an employee through the pay-as-you-earn (PAYE) tax system. In accordance with the international standards, a monthly wage threshold is set at 4 times the hourly minimumwage + holidaypay from the collective agreement between the Faroese Worker's Union and the Faroese Employers Association. Thus, if the monthly wage received is below the mark, the person is not considered an employee that month. The Faroese Safety Authority states that children under the age of 13 cannot be employed, which thus is set to be the minimum age threshold.

In accordance with the above mentioned employees are persons at age 13 or above, who in the relevant month received a wage of minimum 4 hours a month through the pay-as-you-earn (PAYE) tax system as well as persons temporary absent from work.

Other definitions: 

• Employees (main job): Main job of an employee is set to be the main activity and institutional sector of the employer from which the largest wage is received. An employee only counts once.
• Main- and minor jobs: Counts the total of main- and minor jobs together in the institutional sector/economic activity. An employee can have multiple counts due to several jobs in each institutional sector/economic activity.
• Minor jobs: Counts the number of minor jobs in the institutional sector/economic activity. An employee can have multiple counts. Main jobs are excluded.
• Jobs across economic activities: This value portrays the number of employees in each institutional sector/main activity when minor jobs are also included. An employee can only count once in each institutional sector/economic activity, but several times across. Thus the number is higher than the measure of number of employees (main job).
• Employers: Counts the number of employers. Employers count only once, which is in their main activity.”
• Trend:  A depiction of the overall trend in wages by adjusting for seasonal effects and error components in the figures.
• Seasonally adjusted: Numbers are adjusted for seasonal patterns such as recurring seasonal activity patterns. Seasonal adjustment may not be a reliable method in periods with exceptional seasonal fluctuations where monthly figures deviate too much from the regular calendar.
• Institutional sector: The sorting of institutional entities by economic activity. The economic activity is determined by whether the goods and services produced are for the market, whether the ownership is public or private, as well as the type of production. The definitions and terms used are based on the guidelines provided in the 'System of National Accounts' (SNA) by the United Nations and the 'European System of Accounts' (ESA) by Eurostat. In the wage and employment statistics the institutional sectors are grouped differently than normal. Non-financial corporations, financial corporations, households and organizations are grouped together and divided by whether the ownership is public, private or foreign. Public administration and services is unchanged and is divided in to central government, state government, local government and social security funds. 'The Rest of the World' is a separate institutional sector, which is grouped together with unknown sector, if any. When the employment statistics are depicted and described, the institutional sector is often divided by whether the employers are under public or private control.
  • "Under public control" includes "General government" + "Public corporations" 
  • "Under private control" includes "National Private corporations" + "Foreign controlled corporations" + "Rest of the world and not specified"  
• Main activity: Main activity is attached to the employer that pays the wage. An employer is grouped in to the main activity in which he has the largest activity. A person may have several employers, and the employer from which the most wage is paid is set to be the person's main activity of work. Main activity is not necessarily the actual economic activity of the work done for the wages paid as an employer may cover several economic activities. Main activity is based on the international statistical classification of economic activities NACE rev. 2. The first and second level are directly comparable. The third level opens up a few subgroups in order to best portray the national economy. On the third level there are 93 economic activities. 
• Citizenship: Citizenship is grouped in to continents and some smaller geographical areas. Citizenship is based on the country with most inhabitants with said citizenship. For example, Greenland is grouped in to Northern Europe, as they have Danish citizenship, even though the country geographically falls under North America. 
• Long-term residency: Whether a person is deemed as having long-term residency to the Faroes or not. In order to have long-term residency one has to either have lived in the Faroe Islands for half of their life or for 7 out of 10 consecutive years at some point in their life. 

See also Labour force, Unemployment and Wages (PAYE).