The introduction of Alcohol-based hand rubs (ABHR) and hand hygiene practices to Australia in 2002 has been associated with a decrease in methicillin-resistant Staphylococcus aureus (MRSA) infections. However, the MRSA decrease has been paralleled by a nationwide increase in vancomycin resistant Enterococcus faecium (VREfm) infections. Concerned about the potential of VREfm to resist ABHR, we tested the alcohol tolerance and sequenced the genomes of 77 clonal complex-17 E. faecium (Efm) isolates obtained from patients at a major Australian hospital between 1998 and 2014. Genome wide association analyses were performed upon single nucleotide polymorphism, micro insertion/deletions and pan genome variants. To overcome the issue of strong linkage-disequilibrium, the ancestral states of variants were reconstructed enabling detection of convergent evolution so that genuine phenotypic associations could be discerned from clonal population signals. We observed a significant escalation in Efm tolerance to alcohols coinciding with the introduction of ABHR. Current Efm isolates showed a significant 2.5-log10 mean tolerance increase compared to pre-AHBR isolates (p<0.0001), with a maximum 5-log10 difference between some isolates. These increases were independent of Efm clone type and vancomycin resistance status but were highly correlated with increasing hospital ABHR usage rates. Genome wide association analyses revealed non-synonymous and independently emerging mutations in a gene encoding a zinc-binding alcohol dehydrogenase that were significantly associated with alcohol tolerance. Given this association, the observation of paraphyletic origins and on the basis of biological plausibility, these variants were considered as potentially causative. Our observations imply a substantial adaptive response of Efm to ABHR and provide an explanation for the worldwide increase of hospital VREfm infections. While ABHR remains an effective means to control cross transmission of some pathogens, additional infection control strategies may be required to stop the spread of others, such as recently emergent hospital clones of Efm.