Here are some methods I use to determine if they are doing a good job.
1. Defect rate - If they are constantly fixing bugs or you are required to have other developers go over their code and are constant finding basic problems, the developer isn't doing a good job.
2. Taking more time than expected/estimated to do a job. Obviously there's cases where requirements change or unknown issues pop up in the project. But if it's a constant issue, then there is either a problem with management/planning, or the developer isn't making good use of their time.
3. They constantly say "I'm (almost) done, just need to test". A good developer will test as they go along. Once the coding is done there should be very little additional testing that needs to be done. You reasonably certain that everything will work by the time coding is completed.
4. Constant needing to have stuff explained to them. If you constantly need to explain how something is supposed to be done, or have to explain the project 3 or 4 times, then the developer may have a problem. It may also be the case that you aren't explaining the project properly, however, a good developer will ask for clarification up-front instead of nodding yes, and coming back 3 days later with a bunch of questions, no code to show for the passage of time, or maybe even worse, a bunch of code that doesn't do what it's supposed to.
5. Finally, sleeping on the job, constantly late, or going home early or a combination of the above. You wouldn't think that sleeping on the job would be a big thing, but I've seen it happen more often than not. The causes of this could be anything from just bad time management to other things that are more understandable like a personal illness or a sick child/spouse or other personal problem. But the reason doesn't change the fact that the person is going to have performance problems. The employer should identify the problem and work with the employee to resolve the issue.
Finally. It's all about taking metrics in terms of defect rates and whether or not projects are completed on schedule. If they are doing well in these areas, they are probably doing a good job. The other stuff like showing up late or sleeping on the job really shouldn't matter that much as long as the person is getting their work done. But I haven't met a whole lot of people who can sleep/slack off at work while still getting the job done.