The gap between when something is illegal and misleading is huge. A senior executive generally will be told about the stock structure if they ask. They’re usually too experienced to be duped by such a scheme and they need to know above all else what is motivating their peers. However, most folks aren’t told. The argument is that most people don’t understand this stuff and will spread false rumors which has some truth to it. Plus it’s a free market and tech execs reason that rank and file will be in a better position to be informed about sensitive company financials when they have more experience.

If you’re not an executive you must assume the stock is worthless but you might just get lucky. If you are an executive you should ask details about the stock and if they don’t give it to you don’t take the job. If however later they change the stock arrangement without telling you (eg diluting the stock or changing the preferred arrangements) you should confer with your peers and if they are with you, you should ask for the CEOs resignation. If you don’t get it you should find another job and quit, slam the company publicly or ask for a really big severance package