The short answer is you measure student progress over time via standardized testing. Someone was able to obtain anonymized per-teacher data via FOIA request and verify that some teachers perform consistently and significantly better than others in terms of helping their students progress, and that this performance was stable across time and even when teachers moved to different schools. At one point, schools were required to provide this data until the law was successfully repealed at the behest of teacher's unions.
Teacher's unions pay mainly based on seniority, but this same data showed that, after about 5 years, teacher performance didn't really improve much. The unions also pay more for higher degrees, but there was no association found between higher degrees and teacher performance.
The book also discusses how different types of testing have been shown to be strong predictors of both future academic and professional success. You should not be so dismissive of objective numeric testing, whose results can be tracked and compared over time. No metric is perfect, but just about any metric beats that of the unions, who, in one area, had 99.8% of their teachers rated as "proficient". The union's metric is useless, and that is a feature for them, not a bug.
See, the thing is, high school GPA is a better predictor for academic success than standardized testing. Here are four quotes from the many relevant papers found through Google Scholar:
1) "Decomposing GPA: Why Is High School GPA the Best Single Predictor of First- Year GPA?" https://www.researchgate.net/profile/Jeffrey-Steedle/publica... :
> Research has consistently shown that high school grade-point average (HSGPA) is the best single predictor of academic outcomes in the first year of postsecondary education (Bowen, Chingos, & McPherson, 2009). Given that HSGPA is not a standardized measure of academic achievement—and is not therefore perfectly comparable across students or high schools—it likely incorporates information about college readiness beyond academic knowledge and skills.
2) "Does the ACT Composite Score or High School Grade Point Average Provide a Better Prediction of Bachelor Degree Attainment?" https://scholarworks.harding.edu/cgi/viewcontent.cgi?article...
> Results indicated high school GPA to be a significant predictor of persistence to degree attainment while the ACT Composite score was not a significant predictor. Implications from this study suggest that admissions officers may want to emphasize a student's high school GPA in determining if the student will complete a bachelor's degree program.
3) "High School GPAs and ACT Scores as Predictors of College Completion: Examining Assumptions About Consistency Across High Schools" https://journals.sagepub.com/doi/pdf/10.3102/0013189X2090211...
> High school GPAs (HSGPAs) are often perceived to represent inconsistent levels of readiness for college across high schools, whereas test scores (e.g., ACT scores) are seen as comparable. This study tests those assumptions, examining variation across high schools of both HSGPAs and ACT scores as measures of academic readiness for college. We found students with the same HSGPA or the same ACT score graduate at very different rates based on which high school they attended. Yet, the relationship of HSGPAs with college graduation is strong and consistent and larger than school effects. In contrast, the relationship of ACT scores with college graduation is weak and smaller than high school effects, and the slope of the relationship varies by high schoolYou write "objective numeric testing", but tell me, what is the objective reason those tests tend to focus on math and short-form English comprehension? Why do they omit art appreciation, musical skills, physical education, essay writing, and other topics that students learn at school?
4) "What Matters Most for College Completion?" https://www.calstate.edu/apply/Documents/elevating-college-c...
> Both SAT or ACT scores and high school GPA are associated with the likelihood that students at four-year colleges earn a bachelor’s degree. But when considered together, the predictive power of high school GPA is much stronger. Figure 2 shows that, among students with similar SAT or ACT scores, those with higher high school GPAs are much more likely to graduate. But among students with similar high school GPAs, no strong relationship exists between SAT or ACT scores and graduation rates (except that those who score below 800 are noticeably less likely to complete college).
> This makes sense given that earning good grades requires consistent behaviors over time—showing up to class and participating, turning in assignments, taking quizzes, etc.—whereas students could in theory do well on a test even if they do not have the motivation and perseverance needed to achieve good grades. It seems likely that the kinds of habits high school grades capture are more relevant for success in college than a score from a single test.
> ... And the relatively weak predictive power of SAT or ACT scores vanishes entirely once the student’s high school is taken into account, suggesting that the test scores serve partly as a proxy for high school quality.
Sure, you can claim I'm cherry-picking. But the same holds for the book you pointed to. And given just how many papers there are which argue that GPA is more predictive than standardized scores, it's certainly nowhere near as clear-cut as you appear to believe.
Does this start to make you reconsider your opposition to unionized teachers now? If not, why not?