I usually just start the new PCs at 1st level, except in the instance that it's a "replacement" PC to one that has died. In that instance, I usually start the replacement 2 levels below the highest PC's level.
To me, this makes sense for two reasons: 1) I'm a mean GM. 2) You are more likely to find a 1st level character wandering around than a 12th level <enter Prestige Class here>. In instances where the PCs are in a high-powered area (which I typically assume is the case when a person's character dies), I usually use the "2 levels below" method, simply due to the fact that a 1st level person typically wouldn't have survived to that point.
Lower level characters tend to raise quickly in level when running with high level characters, so they tend to catch up rather quickly. Just make sure they have the sense to "play wizard" and use spells/ranged weapons in any fights worth the high level PCs' time.....