I've not been active in this scene for a few years now. Please check everything below with your tax professional.
Settlements for personal injury lawsuits are generally not income under federal tax law.
Employment settlements are tricky. Most good employee-side attorneys will try to include in the settlement documents that the settlement is for emotional distress damages, a type of damages allowed under Title VII and the other employment discrimination statutes. The reason for this is that emotional distress damages are considered personal injury damages and non-taxable, even in employment cases.
But, there was some guidance as I recall from the IRS disfavoring this tactic. The policy reason makes sense. What an employment discrimination claim is supposed to do is pay you the difference between what you made and the additional money you would have made absent the discrimination. Because the damages replace ordinary income, they should be taxed. While the statutes also allow for emotional distress damages on top of loss income, emotional distress damages should only compliment the lost income damages.
You should work with a tax professional to identify your options and risks, especially since I've no idea what your state's law requires.
Good luck!