How do scheduled backups work on encrypted dmg and filevault 2

Under mojave with CCC5 on a 2019 iMac, I intend to clone an encrypted startup disk (filevault2) to a destination volume that will also have filevault enabled. When the system boots up the startup disk becomes available for decryption on the fly once i have provided my password. If the disk containing the backup destination volume is attached, does the destination volume also get opened up for encryption/decryption? If not how does CCC get to write to it during a scheduled backup?

In the case of encrypted disk images, these volumes are only available once they have been mounted which can only take place after authentication. How does a scheduled backup take place if the volumes have not been mounted – does CCC need to have the passwords in order to conduct the backup? How does this work?

Thanks in advance for your help.