I recently was informed that one of my employees, who no longer works for me, logged more hours than they worked when I was on holidays. This employee was acting manager while I was away and the other staff was too afraid to "rat" her out until recently. What rights do I have as an employer?

This very well sums up your rights and responsibilities - Alberta Human Rights: Your rights and responsibilities as an employer.

Take her to Small Claims Court for the hours she was paid but did not work - and make sure you can prove the charge.