TWRP on the Fairphone 2 is not able to decrypt encryption from Android 8 on.
You can try your luck with this custom build here … Custom TWRP 3.2.3 to decrypt Android 8/9 encryption.
But only the data partition is encrypted anyway. The TWRP backup still works for other partitions, so an OS backup can be done, but you would have to backup your data and Apps with other means.
Be aware that TWRP never backs up the Internal Storage, so you would have to deal with Internal Storage differently anyway.