You have to set an Option to get the button. Under the Gallery tab in the left sidebar, go to the Options menu, and then select the Gallery tab at the top. On this page, scroll down to Sort Options and for the first one, selection Custom Sort at the top. Save the changes. You should now see a Sort Gallery button when you are managing a gallery.
Still, the ability to do a custom sort seems to be broken. Half the time I load in images, they load in the correct order, and the rest of the time they do not. I go to Sort Gallery, select Date/Time, and NOTHING happens. No other options change the order of thumbnails either. Used to work seamlessly, but it no longer does and I really really wish this would be fixed. I just uploaded a gallery of 199 images and am going to have to spend a couple of hours just moving the thumbnails around which is NOT easy to do.
I've reported this bug in other posts in the forum with no response. I hope someone from Photocrati is listening. I use Chrome and have all updated WP and plug in software. It is maddening to upload images that are numerically ordered, only to have them scrambled in the gallery and waste large chunks of time reordering with a tool that is imprecise at best.