Centre Te'o and full-back Mike Brown were notable absentees when the squad for the tournament in Japan was named on Tuesday (AEST).
The duo were reportedly involved in an altercation at a social event during England's warm-weather training camp in Treviso last week.
England head coach Jones was not prepared to disclose why British and Irish Lion Te'o had been overlooked from a squad that includes Piers Francis and former Sevens specialist Ruaridh McConnochie.
The Australian said: "I'm not going to go into reasons why he wasn't selected. We've had conversations; he understands it. Whether he agrees with it is another matter.
"We've had that discussion with him and he's just not in our top 31 players at the moment."
Asked if Te'o had missed out due to his form, Jones added: "Again, we don't go into reasons as to why we select them or unselect. We won't disclose conversations we have with players."
Jones also defended his decision to pick only two scrum-halves in Ben Youngs and Willi Heinz, who impressed on debut in the victory over Wales on Sunday.
"We'd like to take three of every specialist position, but that would leave us short in other positions. We decided to go with two there and two at tighthead," Jones said.
"There's risk involved, but there's risk involved in other positions, so we've got contingency. We've got contingency in George Ford to play a little bit of half-back.
"He's been doing some training and we'll continue to do that. If we say we need a third half-back, we believe he can fulfil the role for a period of time."
Forwards: Dan Cole (Leicester, 86 caps), Luke Cowan-Dickie (Exeter, 12), Tom Curry (Sale, 11), Ellis Genge (Leicester, 10), Jamie George (Saracens, 37), Maro Itoje (Saracens, 27), George Kruis (Saracens, 32), Joe Launchbury (Wasps, 59), Courtney Lawes (Northampton, 72), Lewis Ludlam (Northampton, 1), Joe Marler (Harlequins, 58), Kyle Sinckler (Harlequins, 22), Jack Singleton (Saracens, 1), Sam Underhill (Bath, 9), Billy Vunipola (Saracens, 42), Mako Vunipola (Saracens, 53), Mark Wilson (Newcastle/Sale, 13).
Backs: Joe Cokanasiga (Bath, 5), Elliot Daly (Saracens, 31), Owen Farrell (Saracens, 70), George Ford (Leicester Tigers, 56), Piers Francis (Northampton, 5), Willi Heinz (Gloucester, 1), Jonathan Joseph (Bath, 41), Jonny May (Leicester, 45), Ruaridh McConnochie (Bath, uncapped), Jack Nowell (Exeter, 33), Henry Slade (Exeter, 22), Manu Tuilagi (Leicester, 33), Anthony Watson (Bath, 34), Ben Youngs (Leicester, 86).