"Your people are bad."
Translation:Wasi ludzie są źli.
Yes. The grammatical gender of the noun itself is 'masculine personal' (aka. 'virile'), so there is no possibility of treating it any other way.
You can use this word to refer to a group of women and/or children; I wouldn't say that it's wrong, just lexically imprecise, because you could have easily said 'kobiety', 'dzieci' or 'kobiety i dzieci'.
Btw, when referring to a mixed group that does not include men (woman & child / woman & dog / dog & child, etc.) the masculine personal gender is often used.