Why are Wifi Calling and iPhone Cellular Calls Mutually Exclusive?
In the past, the modem software for a specific carrier was responsible for that prompt as their networks weren't able to re-reount the calls on the fly. (i.e. your carrier or carrier settings needing an update was the original issue)

I believe that window of limitation is resolved for all devices and all carriers. If you get this error in 2017, I would work with Apple support to make sure your iOS is updated and then work with carrier support to make sure your phone account is set up for seamless switch between carrier and wifi calling.