This usually occurs because of filler. For example:
01  my-record.
    03  my-key.
        05  filler            pic xx.
        05  field-1           pic xx. 
            	 If my-key is declared as a record key, this error occurs because the area of the key described by filler is not included in the XFD.
Resolution:
To correct this error, ensure that every character that is part of the key is included in some field that is part of the XFD. Use an XFD to give a field name to each filler, to ensure that fillers are included:
 01  my-record.
     03  my-key.
$xfd name=myfiller
         05   filler            pic xx.
         05   field-1           pic xx.