diff --git a/npm/pkg/dataplane/dataplane-test-cases_windows_test.go b/npm/pkg/dataplane/dataplane-test-cases_windows_test.go
index 72b16daacf..82741f7697 100644
--- a/npm/pkg/dataplane/dataplane-test-cases_windows_test.go
+++ b/npm/pkg/dataplane/dataplane-test-cases_windows_test.go
@@ -2224,15 +2224,13 @@ func getAllMultiJobTests() []*MultiJobTestCase {
 		{
 			Description: "create namespaces, pods, and a policy which applies to a pod",
 			Jobs: map[string][]*Action{
-				"finish_bootup_phase": {
-					FinishBootupPhase(),
-				},
 				"namespace_controller": {
 					CreateNamespace("x", map[string]string{"k1": "v1"}),
 					CreateNamespace("y", map[string]string{"k2": "v2"}),
 					ApplyDP(),
 				},
 				"pod_controller": {
+					FinishBootupPhase(),
 					CreatePod("x", "a", ip1, thisNode, map[string]string{"k1": "v1"}),
 					CreatePod("y", "a", ip2, otherNode, map[string]string{"k1": "v1"}),
 					ApplyDP(),
diff --git a/npm/pkg/dataplane/dataplane.go b/npm/pkg/dataplane/dataplane.go
index 0ab6a76bd6..8164a06027 100644
--- a/npm/pkg/dataplane/dataplane.go
+++ b/npm/pkg/dataplane/dataplane.go
@@ -18,10 +18,11 @@ import (
 const (
 	reconcileDuration = time.Duration(5 * time.Minute)
 
-	contextBackground = "BACKGROUND"
-	contextApplyDP    = "APPLY-DP"
-	contextAddNetPol  = "ADD-NETPOL"
-	contextDelNetPol  = "DEL-NETPOL"
+	contextBackground      = "BACKGROUND"
+	contextApplyDP         = "APPLY-DP"
+	contextAddNetPol       = "ADD-NETPOL"
+	contextAddNetPolBootup = "BOOTUP-ADD-NETPOL"
+	contextDelNetPol       = "DEL-NETPOL"
 )
 
 var ErrInvalidApplyConfig = errors.New("invalid apply config")
@@ -276,24 +277,21 @@ func (dp *DataPlane) RemoveFromList(listName *ipsets.IPSetMetadata, setNames []*
 // and accordingly makes changes in dataplane. This function helps emulate a single call to
 // dataplane instead of multiple ipset operations calls ipset operations calls to dataplane
 func (dp *DataPlane) ApplyDataPlane() error {
-	if dp.applyInBackground {
-		return dp.incrementBatchAndApplyIfNeeded(contextApplyDP)
+	if !dp.applyInBackground {
+		return dp.applyDataPlaneNow(contextApplyDP)
 	}
 
-	return dp.applyDataPlaneNow(contextApplyDP)
-}
-
-func (dp *DataPlane) incrementBatchAndApplyIfNeeded(context string) error {
+	// increment batch and apply dataplane if needed
 	dp.applyInfo.Lock()
 	dp.applyInfo.numBatches++
 	newCount := dp.applyInfo.numBatches
 	dp.applyInfo.Unlock()
 
-	klog.Infof("[DataPlane] [%s] new batch count: %d", context, newCount)
+	klog.Infof("[DataPlane] [%s] new batch count: %d", contextApplyDP, newCount)
 
 	if newCount >= dp.ApplyMaxBatches {
-		klog.Infof("[DataPlane] [%s] applying now since reached maximum batch count: %d", context, newCount)
-		return dp.applyDataPlaneNow(context)
+		klog.Infof("[DataPlane] [%s] applying now since reached maximum batch count: %d", contextApplyDP, newCount)
+		return dp.applyDataPlaneNow(contextApplyDP)
 	}
 
 	return nil
@@ -380,32 +378,65 @@ func (dp *DataPlane) AddPolicy(policy *policies.NPMNetworkPolicy) error {
 		return fmt.Errorf("[DataPlane] error while adding Rule IPSet references: %w", err)
 	}
 
-	var endpointList map[string]string
-	if dp.inBootupPhase() {
+	inBootupPhase := false
+	if dp.applyInBackground {
+		dp.applyInfo.Lock()
+		inBootupPhase = dp.applyInfo.inBootupPhase
+		if inBootupPhase {
+			// keep holding the lock to block FinishBootupPhase() and prevent PodController from
+			// coming back online and causing race issues from updatePod() within applyDataPlaneNow()
+			defer dp.applyInfo.Unlock()
+		} else {
+			dp.applyInfo.Unlock()
+		}
+	}
+
+	if inBootupPhase {
 		// During bootup phase, the Pod controller will not be running.
 		// We don't need to worry about adding Policies to Endpoints, so we don't need IPSets in the kernel yet.
 		// Ideally, we get all NetworkPolicies in the cache before the Pod controller starts
-		err = dp.incrementBatchAndApplyIfNeeded(contextAddNetPol)
-		if err != nil {
-			return err
-		}
-	} else {
-		err = dp.applyDataPlaneNow(contextAddNetPol)
-		if err != nil {
-			return err
+
+		// increment batch and apply IPSets if needed
+		dp.applyInfo.numBatches++
+		newCount := dp.applyInfo.numBatches
+		klog.Infof("[DataPlane] [%s] new batch count: %d", contextAddNetPolBootup, newCount)
+		if newCount >= dp.ApplyMaxBatches {
+			klog.Infof("[DataPlane] [%s] applying now since reached maximum batch count: %d", contextAddNetPolBootup, newCount)
+			klog.Infof("[DataPlane] [%s] starting to apply ipsets", contextAddNetPolBootup)
+			err = dp.ipsetMgr.ApplyIPSets()
+			if err != nil {
+				return fmt.Errorf("[DataPlane] [%s] error while applying IPSets: %w", contextAddNetPolBootup, err)
+			}
+			klog.Infof("[DataPlane] [%s] finished applying ipsets", contextAddNetPolBootup)
+
+			dp.applyInfo.numBatches = 0
 		}
 
-		endpointList, err = dp.getEndpointsToApplyPolicy(policy)
+		err = dp.policyMgr.AddPolicy(policy, nil)
 		if err != nil {
-			return fmt.Errorf("[DataPlane] error while getting endpoints to apply policy after applying dataplane: %w", err)
+			return fmt.Errorf("[DataPlane] [%s] error while adding policy: %w", contextAddNetPolBootup, err)
 		}
+
+		return nil
+	}
+
+	// standard, non-bootup phase
+	err = dp.applyDataPlaneNow(contextAddNetPol)
+	if err != nil {
+		return err
+	}
+
+	var endpointList map[string]string
+	endpointList, err = dp.getEndpointsToApplyPolicy(policy)
+	if err != nil {
+		return fmt.Errorf("[DataPlane] error while getting endpoints to apply policy after applying dataplane: %w", err)
 	}
 
-	// endpointList will be empty if in bootup phase
 	err = dp.policyMgr.AddPolicy(policy, endpointList)
 	if err != nil {
 		return fmt.Errorf("[DataPlane] error while adding policy: %w", err)
 	}
+
 	return nil
 }
 
@@ -582,14 +613,3 @@ func (dp *DataPlane) deleteIPSetsAndReferences(sets []*ipsets.TranslatedIPSet, n
 	}
 	return nil
 }
-
-func (dp *DataPlane) inBootupPhase() bool {
-	if !dp.applyInBackground {
-		return false
-	}
-
-	dp.applyInfo.Lock()
-	defer dp.applyInfo.Unlock()
-
-	return dp.applyInfo.inBootupPhase
-}