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UNLESS IT RESISTS THE TEMPTATION to follow the lead of San Francisco regarding domestic partner mandates, New York threatens to take a bad idea and make it worse.

As we report on page 1, a member of the New York City Council has called for legislation that would require companies that want to do business with the city to offer domestic partner benefits equal to those offered to employees' spouses. San Francisco first approved such a mandate last year (BI, Nov. 11, 1996), and the idea hasn't improved with age.

We have no quarrel with employers offering domestic benefits. Employers should be free to offer-or withhold-such benefits as meet their needs and the needs of their employees. Employees are a diverse lot, and meeting their varied needs requires giving employers flexibility.

For a city government to dictate what benefits another employer must offer in order to do business with the city replaces that necessary flexibility with a straitjacket.

San Francisco's mandate was bad, but New York's measure, as currently proposed, would take the mandate another step in the wrong direction. That's because the San Francisco mandate applies only to domestic partners who have registered their partnerships with the city. The measure likely to hit the New York City Council in a couple months wouldn't even require that minimal commitment.

Before New York pushes ahead with its ill-considered scheme, the council members ought to take a close look at what's happening on the other side of the country as San Francisco grapples with the problems its domestic partner mandate already has caused, even though the mandate does not formally fall upon employers until June.

Archbishop William Levada has asked that Catholic Charities-with which San Francisco contracts for more than $5 million in services-be exempt from the mandate. The archbishop said that requiring Catholic Charities to provide the domestic partner benefits would violate the church's teachings.

The city has adamantly refused to relent, and the archbishop has indicated that a lawsuit might be the next step.

Mandating domestic partner benefits does nothing to encourage employers to offer such coverage voluntarily. In fact, it could have the unfortunate effect of causing some employers, particularly small businesses already hard-pressed by benefits costs, to reconsider whether they should offer any benefits at all.

San Francisco has made its mistake and will have to live with the consequences of meddling in what should be a matter between employer and employees, not city government and those who would do business with it.

Rather than compound that mistake, the New York City Council ought to drop the proposed domestic partner mandate now and avoid the inevitable problems-legal and otherwise-such an unwise policy is certain to cause.