First, one team drafts all its players for its roster. Then, the second team fills its roster from the remaining undrafted players, and so forth.
While this may seem grossly unfair, the draft order rotates every season, so each team has a chance every N years to be the first team with all the superstars.
The goal of each season is to finish ranked better than your draft order.
No idea of how to do salary, injury replacement.
Assuming a 5-person team, we may see the suboptimal outcome of the 6th best player in the league being a bench warmer for the first team rather than a starter on the second.
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