In Europe, every electronics product marketed to consumers must pass a battery of tests, one of them for the photobiological safety of any included light source according to IEC/EN 62471:2008, a slight revision of IEC 62471:2006. This is mandatory since September 2011, so almost any iPhone in existence must have qualified in order to be marketable.
Since all major electronics manufacturers design their products for worldwide sales, Apple has to subject all iPhones to this standard. If any eye damage is to be expected, a warning label needs to be present (see below, source).
In the absence of such a warning, eye damage from exposure to the flashlight is extremely unlikely.