This is not the case. It is true that a jack is a small flag used to indicate the nationality of a ship, but the widespread use of Union Jack is legitimate. The Flag Institute explains why:
“From early in its life the Admiralty itself frequently referred to the [Union] flag as the Union Jack, whatever its use, and in 1902 an Admiralty Circular announced that Their Lordships had decided that either name could be used officially. Such use was given Parliamentary approval in 1908 when it was stated that ‘the Union Jack should be regarded as the National flag’.”
The OED states that Union Jack is now the usual term to describe the national flag of the United Kingdom.
It also is worth noting that the Union Jack has a correct way up. The wide white diagonal stripe should be above the red diagonal stripe on the half of the flag that is closest to the flagpole. (This is because the St. Andrew’s Cross takes precedence over the St. Patrick’s Cross.)
- The Flag Institute
- The Oxford English Dictionary Online