local avoidance question

I know this question has been beaten to death, but I am trying to write my own kind of local avoidance code. I saw another post where someone reccomended finding the distance between 2 objects and then having a vector push the unit in the opposite direction. I tried this method using the code below as a test:

 float distance = Vector3.Distance (GameObject.Find("Unit1").transform.position, GameObject.Find("Unit2").transform.position);
         if (distance < 2) {
             Vector3 direction = GameObject.Find("Unit1").transform.position - GameObject.Find("Unit2").transform.position;
             transform.Translate(-direction.normalized *Time.deltaTime);
         }

It worked except that the units seem to push each other into the floor, and they are still not exactly repelling each other in the correct way each time. Is there a way I can freeze the Y componenet of the vector? Also I tried the AddForce function but this didnt work either. Anyone know of a way? Thanks,