I saw them implement a new armor system on Kalyna, because it was clipping through on the beta versions, so maybe they did decide to go for a visual armor system. But it seemed very basic, I wouldn't say very good either.
I just think add a model to all the basic mercs that don't have a lot of tactical or armor gear on, and add a model that has them wearing something tactical, can be a vest, can be tactical equipment for carrying ammo magazines, etc.