Clarification on unlisted apps

I am developing a time control app, that allows the employees of a company to register their work hours (entry, exit and interval times). After careful studies on wich distribution method to choose, we decided that an Unlisted App would be the best approach. We thought of distributing the app via Ad Hoc, but the security clearences needed to run it conlficts with some laws of my country, and any sort of MDM is out of the question, since the app is intended to be run o both users private or company owned devices alike. This way, having it on the App Store as unlisted would solve both theese problems, since it would facilitate distribution to the users, and still have some sort of privacy.

Problem is, when I sent my app for revision, i received the following message:

"We found in our review that your app is intended to be used by a specific business or organization, including partners, clients, or employees, but you've selected public distribution on the App Store in App Store Connect. Since the App Store is intended for apps with a public audience, we recommend reviewing the other distribution options available to you through your Apple Developer Program Account. "

I would like to ask for some support on this, did my intentions have been misinterpreted, or should I look for another solution to distribute the app?

For clarification, I have created a Unlisted App request, and then sent my app for revision.