The onset of plasticity in quenched martensitic microstructures is characterized by a low initial yield stress followed by an extremely strong initial hardening response, and then a sudden hardening saturation. Literature attributes this behavior to residual stresses and dislocations inherited from the martensitic transformation, or to microstructural heterogeneities causing strength differences among the grains. Here, we argue that orientation-dependent yielding of lath martensite due to inter-lath sliding, which induces a substructure boundary sliding mechanism that may also contribute significantly to the observed behavior. To demonstrate this, we systematically study its quantitative contribution to the elasto-plastic transition behavior in a numerical microstructural model. In the simulations, we employ an effective laminate model for the martensite packets which takes into account the yielding anisotropy due to sliding along the packet's habit plane orientation. To account for the effect of carbon content, martensitic microstructures with different levels of lath strength are considered. It is shown that the martensite packets with a favorable habit plane orientation start to yield earlier compared to those with an unfavorable orientation, which initially remain elastic. As a consequence, the macro-scale response of the microstructures exhibits a low yield stress, followed by a significant degree of initial hardening which continues until the saturation stress level is approached. The apparent work hardening rate depends on the contrast between the in-habit plane and out-of-habit plane yield strength used in the model. Moreover, our simulations are able to qualitatively capture other observations reported in the literature regarding the high initial hardening behavior of quenched martensitic steels, e.g. that the initial plastic yielding is independent of carbon content and thus of lath strength, and that the uniform elongation increases by increasing the macroscopic strength.