Health: Kodem Matan Torah you didn’t need Smichah. So Shimon and Levi could themselves function as the Eidim and Dayanim that the city knew and allowed Shchem to get away with it.
You still need a Dayan, though, and to be Kasher for Dayanus you need Smichah. You still need a Kosher Eid (meaning a Jew, not a Goy). It’s a Misas Beis Din. There is just a more lenient requirement here for what constitutes a Beis Din and what constitutes testimony.