A Meme from Portal 1. During the game, GlaDOS encourages you to solve intricate puzzles using cake as a motivating perk. When you have "broken out" of the game's initial testing phase (from threat of death), you find scrawls on walls of the innards of the testing center warning you that "the cake is a lie".
It can be used as a phrase to imply that a promised reward for one's work is false, with the one offering the reward never intending to give it in the first place, possibly because the reward never even existed.