Many DMs don't use "party level." Such a thing has not been encouraged in the rules so far, and the rules for building encounters go out of their way to tell you how to deal with a party where the PCs are different levels.Personally I'd start the new pc at the current party level.
Always at level 1 will become super harsh when the rest of the party is at, say, level 10.
As mentioned by others, bounded accuracy makes this OK. It really isn't super harsh. A level 1 character really can contribute meaningfully even if his friends are level 10.
It takes 21,000 XP to rise from level 10 to level 11. With the same amount of XP, a level 1 character will become level 6 -- very nearly level 7.
Then it's another 15,000 XP to get to 12. (Yes, D&D has a hell level, and level 10 is it!) This would put the lower-level character at 36,000 = level 8. He may never truly catch up, but he's closing the gap rather quickly!
Having party members of varying levels is built into the XP table. Making a dead guy start over at level 1 is a perfectly reasonable penalty for getting killed.