The current SharePoint Online experience creates a new (hidden) site collection when the user selects "New Site" from the SharePoint landing page.
Alternatively, authorized users can create sub-sites on the default site collection team site by going to Site Contents > New Subsite (in the classic view).
Are there any changes in recommended best practices for creating sub-sites? Based on this article, http://sharepointmaven.com/structure-sites-sharepoint-intranet/, it is noted recommended to use a single site collection with 1st Level Sub-Site categories,
and 2nd level sites within those (unless the agency is very large).

We are a 400 employee company just getting started with SharePoint, and do not yet have a protocol for site hierarchy. I have noticed my colleagues are creating New Team Sites (which are hidden site collections?) when asked for new SharePoint sites. In
fact, when I ask our IT Team to list all of the sites they cannot do so easily (is this because the hidden site collections are not visible to them by default?)
It seems to me we should be creating sub-sites under the default site collection, not creating a new hidden site collection every time. Our use of SharePoint is probably headed in the direction listed in the diagram above, major categories are HR, a few
other departments, and projects.
What are the pro's and cons of each approach? What is recommended for our use case?