It uses the stock rear sight, which can be replaced by a garand rear sight if you are having trouble with the sight that came with the rifle.
I too love my navy front sight. The full circle of protection around it allows another referrence point when aligning the front sight with the rear sight, and I feel that it helps in keeping better sight alignment.
You can center the front "circle" in the rear circle, and while keeping those aligned place the top of the sight post on the desired point of aim. For those of us who haven't had major (read: military) practice with this rifle to the point that we can consistantly shoulder it in the exact same position, it's a help.
The "spot" weld that this stock is designed for makes it a bit tougher to be consistant if you are not familiar with the unit. For *me* this sight helps reduce this problem.