Found a temporary fix and maybe a cause of the problem
There are two keyrings one called 'login' and the other is called 'default' and 
is the default keyring. During login only the 'login' keyring gets unlocked, 
thus when connection via WiFi it asks for the password of the 'default' keyring.

So I set the 'login' keyring as default and removed the 'default'
keyring. And now I don't see the unlock screen anymore.

Although this is a fix it should be clear that the 'automatically unlock
keyring' option should work.

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Prompted to unlock keyring twice on log in
https://bugs.launchpad.net/bugs/637702
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