I've had a variation on this problem with every iOS update for the last 3-4 years. Usually I'm able to correct it after some combination of removing photos, re-syncing, repairing iPhoto Library permissions, rebuilding the iPhoto Library (those last two can be done by holding down command+option then opening the iPhoto application on your Mac).
I've tried all my tricks this year and none have worked. I'm concerned that respecting iPhoto organization when photos are synced to iOS is a low priority at Apple as they move all iOS devices (and Macs) to their new iCloud Library photo solution. To that end, I'm really concerned there will never be a fix for this particular issue, because in a few months' time Apple expects all users to adopt the new photo workflow to manage their libraries on iOS and OS X.
Today I found a work-around I thought I'd share. There's an app called PhotoSync for wirelessly managing the transfer of photos to/from iOS devices to/from all kinds of sources like iPhoto, Finder, Dropbox, Flikr, FTP, etc. It's a $2.99 app on the App Store, with a free Mac utility on the Mac App Store. I downloaded it hoping it could completely replace iPhoto/iTunes as my photo syncing solution on iOS while iOS 8 makes it such a headache.
When I opened the iOS app on my 5S, I discovered that PhotoSync shows you all the photos on your phone except they're all properly ordered.
That is, all of my Albums, Events, and Faces that had been synced from iPhoto using iTunes were represented in this app and unlike in iOS 8 Photos they were properly ordered by name (in the case of the Faces and Albums) and by date in reverse chronological order (which is exactly how I have my Events sorted in iPhoto).
I know a $3 app isn't a great "solution" but for me it was well worth the money to have an app I can open that has all of my photos organized exactly how I want them. I buried iOS 8 Photos in a folder and moved PhotoSync to my home screen; I'll be using it to interact with my photo library until there's an update to iOS 8 that fixes this annoying bug.
PhotoSync - http://www.photosync-app.com