Goblins are small, diminutive humanoid creatures. They are approximately the size of a small child, they are short-lived, and they have very low intelligence.
In my fantasy world, goblins have been bred and domesticated like dogs. They can be taught simple commands and tasks, though they lack the intelligence for any skilled labor. They can use tools, but they still require oversight. Their lifetimes are too short to be worth much investment.
They are basically dogs with opposable thumbs.
Goblins have been bred to work on castles, farms and stables, etc. doing all the menial jobs. They are best suited for repetitive tasks that require no thought.
They are not paid, and will work because that's what they've been bred to do.
Like dogs, some goblins are prone to distractions and will occasionally be mischievous. They cannot be trusted with anything valuable.
They have very little strength, but decent stamina. Goblins can also eat near anything, and are very easy to sustain - they will happily live off trash and leftovers. They have good sense of smell, they have night vision, and are decent hunters. They work well in numbers.
Domesticated or no, most animals will spook around goblins. Also, the sight of fire can send a goblin into a craze.
There is a risk of goblins going wild if left unsupervised.
Right now, I'm thinking that goblins will be used to wipe the floors and clean stables. Are there any other jobs in medieval-like setting where domesticated goblins could be employed?
Edit: Goblins are nocturnal creatures, and the sight of any fire has a hypnotizing effect to them. Even small flames can entrance them and large blazes will send them mad.