It's a modern convention with no grounding in history or etiquette most often stated categorically by the ignorant and annoying. The Jack Staff didn't come into existence until the middle/late 1700s and the name Union Jack dates back to the early 1600s. Jack as it meant then was a diminutive name for the flag (i.e. a small flag) the original source for that reference has been lost to history and could refer to a small flag flown from a bowsprit, the colours sewn to the jacks by British men-at-arms post the union with Scotland or even reference to James VI of Scotland/I of England. The etymology has been lost.
The Admiralty itself throughout history refers to it in either form in official memoranda regardless of how it is situated and in 1908 Parliament gave approval that “the Union Jack should be regarded as the National flag”
It's one of those urban myths that I wish would die because the people spouting it are more often than not tub thumping ignorant bigots with no real knowledge of their own history so have no right to comment
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