Can we put FMLA paperwork for employees in theri benefits file?
Or does this violate HIPAA?
I assum putting in Personnel file is a nono as well?

FMLA paperwork is not subject to HIPAA. It is not a violation to place this material in either file, however, you should ensure that only individuals who have been trained in HIPAA and have a need for such information have access to files with information that is subject to HIPAA.

Therefore, if people who are not "within the HIPAA firewall" require access to FMLA information, FMLA and HIPAA information (e.g., health plan claims) should remain separate.

We keep our FMLA paperwork in the employee's benefit file. This file is completely separate from the "regular" personnel file.