Laypeople is a very new term. Layman is the time honored term, because people think -man means male. Werelay and wyflay would be gendered terms specifically referring to men or women, layman is ungendered.
In recent times we’ve changed the meaning of the suffix -man to be synonymous with the prefix were-.
It’s a shame, because it implies we were something we weren’t (re: sexism in that part of language) - but I am not defending the stance of not changing it. Just be aware: it’s new.