I was able to reproduce the issue. Problem is step 1 is refering to steps that are not created yet. Following code will generate the same error you are getting.
USE [msdb]
GO
BEGIN TRANSACTION
DECLARE @ReturnCode INT
SELECT @ReturnCode = 0
IF NOT EXISTS (SELECT name FROM msdb.dbo.syscategories WHERE name=N'[Uncategorized (Local)]' AND category_class=1)
BEGIN
EXEC @ReturnCode = msdb.dbo.sp_add_category @class=N'JOB', @type=N'LOCAL', @name=N'[Uncategorized (Local)]'
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
END
DECLARE @jobId BINARY(16)
EXEC @ReturnCode = msdb.dbo.sp_add_job @job_name=N'test333',
@enabled=1,
@notify_level_eventlog=0,
@notify_level_email=0,
@notify_level_netsend=0,
@notify_level_page=0,
@delete_level=0,
@description=N'No description available.',
@category_name=N'[Uncategorized (Local)]',
@owner_login_name=N'domain\account', @job_id = @jobId OUTPUT
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
EXEC @ReturnCode = msdb.dbo.sp_add_jobstep @job_id=@jobId, @step_name=N'GetDate',
@step_id=1,
@cmdexec_success_code=0,
@on_success_action=4,
@on_success_step_id=2,
@on_fail_action=4,
@on_fail_step_id=3,
@retry_attempts=0,
@retry_interval=0,
@os_run_priority=0, @subsystem=N'TSQL',
@command=N'select getdate()',
@database_name=N'master',
@flags=0
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
EXEC @ReturnCode = msdb.dbo.sp_add_jobstep @job_id=@jobId, @step_name=N'success',
@step_id=2,
@cmdexec_success_code=0,
@on_success_action=1,
@on_success_step_id=0,
@on_fail_action=2,
@on_fail_step_id=0,
@retry_attempts=0,
@retry_interval=0,
@os_run_priority=0, @subsystem=N'TSQL',
@command=N'Print ''i am success''',
@database_name=N'master',
@flags=0
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
EXEC @ReturnCode = msdb.dbo.sp_add_jobstep @job_id=@jobId, @step_name=N'failure',
@step_id=3,
@cmdexec_success_code=0,
@on_success_action=2,
@on_success_step_id=0,
@on_fail_action=2,
@on_fail_step_id=0,
@retry_attempts=0,
@retry_interval=0,
@os_run_priority=0, @subsystem=N'TSQL',
@command=N'print ''i am failure''',
@database_name=N'master',
@flags=0
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
EXEC @ReturnCode = msdb.dbo.sp_update_job @job_id = @jobId, @start_step_id = 1
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
EXEC @ReturnCode = msdb.dbo.sp_add_jobserver @job_id = @jobId, @server_name = N'(local)'
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
COMMIT TRANSACTION
GOTO EndSave
QuitWithRollback:
IF (@@TRANCOUNT > 0) ROLLBACK TRANSACTION
EndSave:
GO
I commented out 4 lines on the 1st step. Added a section calling sp_update_jobstep. This code will not throw the error you are getting. I am only pasting modified code here.
EXEC @ReturnCode = msdb.dbo.sp_add_jobstep @job_id=@jobId, @step_name=N'GetDate',
@step_id=1,
@cmdexec_success_code=0,
--@on_success_action=4,
--@on_success_step_id=2,
--@on_fail_action=4,
--@on_fail_step_id=3,
........
IF (@@ERROR <> 0 OR @ReturnCode <> 0) GOTO QuitWithRollback
Add this at the end of creating last step and before running sp_add_jobserver.
EXEC msdb.dbo.sp_update_jobstep @job_id=@jobid, @step_id=1 ,
@on_success_action=4,
@on_success_step_id=2,
@on_fail_action=4,
@on_fail_step_id=3
