We describe the local structural properties of the iron oxychalcogenides, La2O2Fe2OM2(M=S,Se), by using pair distribution function analysis applied to total scattering data. Our results from neutron powder diffraction show that M = S and Se possess similar nuclear structures at low and room temperatures. The local crystal structures were studied by investigating deviations in atomic positions and the extent of the formation of orthorhombicity. Analysis of the total scattering data suggests that buckling of the Fe2O plane occurs below 100 K. The buckling may occur concomitantly with a change in octahedral height. Furthermore, within a typical range of 1-2 nm, we observed a short-range orthorhombiclike structure suggestive of nematic fluctuations in both of these materials.